Agent's Fees

[jitagon]

In the uk for instance, the proceeds of sale of a house are held by the solicitor/conveyancer and then the agents' fee is deducted upon completion of contract. I doubt anyone allows a bank here to transfer a wad of cash to some jobbing lawyer, and then said lawyer dutifully pays the agent his fee. So. How does it work hereabouts? Or, to put it another way. How does the estate agent/realtor guarantee his commission?

[PattayaParent]

The purchaser pays the agent the booking fee and 10% deposit on signing of the contract.

[issanpaul]

In the uk for instance, the proceeds of sale of a house are held by the solicitor/conveyancer and then the agents' fee is deducted upon completion of contract. I doubt anyone allows a bank here to transfer a wad of cash to some jobbing lawyer, and then said lawyer dutifully pays the agent his fee. So. How does it work hereabouts? Or, to put it another way. How does the estate agent/realtor guarantee his commission?

I would of thought same UK , At the end of sale ?

[norrona]

it is taken from the seller always, okay maybe the agent just deducts their comm from the holding deposit paid at the beginning by the buyer but as a rule it is always paid by the seller..

it should never be taken until the end of completion and always the agent should provide some kind of reciept/invoice

Edited August 28, 2008 by norrona

[jitagon]

it is taken from the seller always, okay maybe the agent just deducts their comm from the holding deposit paid at the beginning by the buyer but as a rule it is always paid by the seller..

it should never be taken until the end of completion and always the agent should provide some kind of reciept/invoice

Yes I understand that the seller must pay the commission. What I don't understand is how?

When a buyer and seller agree a price on a piece of land, for instance, it is usual for both parties to meet up at the Land Office to exchange the Title Deed for the agreed purchase price, usually in cash. So the seller goes off with the cash and the buyer with the newly registered deed. How does this work if there's an agent involved? Given the fact that the usual practice is for just the two interested parties to exchange Deed for Cash at the Land Office? Surely no one's about to hand over a sizeable amount of cash to a third party, namely a real estate agent, and hope for the best at the Land Registry Office?

[eljeque]

It varies from agent to agent.

Some want their entire 3% or 5% from the 10% deposit..... Although it is not due to them, and make sure the contract does not mention that they have the right to it at that point in time.

If the agent is going to hold the deposit until the closing date, which is common but not 100%, then make cure in no uncertain terms that the agent will turn that money over to you (the seller) on the closing date whether or no the buyer has all of his money together.

You do not have to cancel the contract if the buyer is late, which is common when buyers are moving money from overseas, but demand that the funds are forwarded to you on the closing date, and give the agent maybe 1/3 of his commission.

I have a complete 3% commission to an agent who got a 10% and then an additional 5% late additional deposit for me...... then the buyer disappeared. I got 12% and the agent got 3%.

Try to get a minimum of 10% as a deposit. It does not mater if the agent tells you that 10% s standard. There is no standard. There is only what you want to do, and what you allow to be done with the sale of your property.... and you do not want to put off a buyer by asking too much.

Also, unless you get a large deposit, do not allow a lot of time for the buyer to arrange for funds. It is quite common for buyers to default.

Of the last 4 houses I have sold, there have been 8 buyers making deposits.

1/2 of the buyers have defaulted. It is really rather common.

Good luck

[norrona]

it is taken from the seller always, okay maybe the agent just deducts their comm from the holding deposit paid at the beginning by the buyer but as a rule it is always paid by the seller..

it should never be taken until the end of completion and always the agent should provide some kind of reciept/invoice

Yes I understand that the seller must pay the commission. What I don't understand is how?

When a buyer and seller agree a price on a piece of land, for instance, it is usual for both parties to meet up at the Land Office to exchange the Title Deed for the agreed purchase price, usually in cash. So the seller goes off with the cash and the buyer with the newly registered deed. How does this work if there's an agent involved? Given the fact that the usual practice is for just the two interested parties to exchange Deed for Cash at the Land Office? Surely no one's about to hand over a sizeable amount of cash to a third party, namely a real estate agent, and hope for the best at the Land Registry Office?

did you not read what I wrote....if you are meeting people down the land office who say they want to buy your land and theres no deposit paid then either a, you have plenty of time on your hands, b, you are hoping to sell something that isn't worth the asking price and chancing it or c, are just inviting to be messed about by the many tyre kickers that frequent this land with heads full of dreams

free info over....find another sucker

and if an agent is involved in a deal that a buyer and seller has worked out between them then maybe i'll come back and re-open my real estae business cos that is gravy biz

Edited August 28, 2008 by norrona

[quiksilva]

In the case of a sale we do not invoice our clients until title deed and funds have actually transferred. Our job is to sell, and for us that means to guide the transaction through to closing and a little beyond.

[jitagon]

it is taken from the seller always, okay maybe the agent just deducts their comm from the holding deposit paid at the beginning by the buyer but as a rule it is always paid by the seller..

it should never be taken until the end of completion and always the agent should provide some kind of reciept/invoice

Yes I understand that the seller must pay the commission. What I don't understand is how?

When a buyer and seller agree a price on a piece of land, for instance, it is usual for both parties to meet up at the Land Office to exchange the Title Deed for the agreed purchase price, usually in cash. So the seller goes off with the cash and the buyer with the newly registered deed. How does this work if there's an agent involved? Given the fact that the usual practice is for just the two interested parties to exchange Deed for Cash at the Land Office? Surely no one's about to hand over a sizeable amount of cash to a third party, namely a real estate agent, and hope for the best at the Land Registry Office?

did you not read what I wrote....if you are meeting people down the land office who say they want to buy your land and theres no deposit paid then either a, you have plenty of time on your hands, b, you are hoping to sell something that isn't worth the asking price and chancing it or c, are just inviting to be messed about by the many tyre kickers that frequent this land with heads full of dreams

free info over....find another sucker

and if an agent is involved in a deal that a buyer and seller has worked out between them then maybe i'll come back and re-open my real estae business cos that is gravy biz

Perhaps I should clarify. I did not say anything about people wanting to buy my land I was asking how a the transaction takes place. If you read my post again, I said that, in my experience, both money and deed are exchanged at the Land Office. Insofar as, the seller gives the signed deed to the buyer, in receipt of CASH. Surely a buyer doesn't turn up with a pastry box stuffed with millions of baht. Gottit?

[quiksilva]

We usually suggest that sales be settled with cashiers cheques, which can be verified with a phone call to the bank manager.

[PattayaParent]

it is taken from the seller always, okay maybe the agent just deducts their comm from the holding deposit paid at the beginning by the buyer but as a rule it is always paid by the seller..

it should never be taken until the end of completion and always the agent should provide some kind of reciept/invoice

Yes I understand that the seller must pay the commission. What I don't understand is how?

When a buyer and seller agree a price on a piece of land, for instance, it is usual for both parties to meet up at the Land Office to exchange the Title Deed for the agreed purchase price, usually in cash. So the seller goes off with the cash and the buyer with the newly registered deed. How does this work if there's an agent involved? Given the fact that the usual practice is for just the two interested parties to exchange Deed for Cash at the Land Office? Surely no one's about to hand over a sizeable amount of cash to a third party, namely a real estate agent, and hope for the best at the Land Registry Office?

The purchaser pays the agent the booking fee and 10% deposit on signing of the contract

[jitagon]

it is taken from the seller always, okay maybe the agent just deducts their comm from the holding deposit paid at the beginning by the buyer but as a rule it is always paid by the seller..

it should never be taken until the end of completion and always the agent should provide some kind of reciept/invoice

Yes I understand that the seller must pay the commission. What I don't understand is how?

When a buyer and seller agree a price on a piece of land, for instance, it is usual for both parties to meet up at the Land Office to exchange the Title Deed for the agreed purchase price, usually in cash. So the seller goes off with the cash and the buyer with the newly registered deed. How does this work if there's an agent involved? Given the fact that the usual practice is for just the two interested parties to exchange Deed for Cash at the Land Office? Surely no one's about to hand over a sizeable amount of cash to a third party, namely a real estate agent, and hope for the best at the Land Registry Office?

The purchaser pays the agent the booking fee and 10% deposit on signing of the contract

So now we have the agent receiving the deposit, and not the seller, as has been suggested. Plus a 'booking fee'? What exactly is the booking fee for and when is that paid?

[PattayaParent]

So now we have the agent receiving the deposit, and not the seller, as has been suggested. Plus a 'booking fee'? What exactly is the booking fee for and when is that paid?

That's right, the agent receives the 10% deposit from which he can take his commission and give the balance to the seller, thus ensuring that he has his money.

When an agent shows you a property and you say you want to buy it he will ask you for a booking fee, usually around 10,000 to 50,000 depending on the value of the property. This is so the agent notifies th seller of a purchaser and puts a 'hold' on the listing and will not market it to anyone else while you raise the 10% deposit. Of course this is only a safeguard if there is a sole agent dealing with the sale.

The deposit is reduced by the amount of the booking fee so the agent only holds 10%.

[tangoll]

Further to what quiksilva said about cashier's cheques for settlement, be especially careful whether you as seller will receive a bank draft or cashier's cheque and from which locality the cheque is issued.

I've just had a go around with my buyer and local Bangkok Bank about the cost of clearing a cashier's cheque drawn on Bank Ayudhaya from Chonburi. The normal charge to clear a cashier's cheque drawn outside of Bangkok is 0.1% which my local Bangkok Bank branch reduced to 0.05% after getting approval from their Head Office for this reduction.

So a cheque of amount, say 5 million, will normally cost baht 5,000 to clear (0.1%). Can you believe this?

In banker's terminology, there is a difference between a bank draft and a cashier's cheque. The best and most economical form of clearance is a cashier's cheque drawn on a bank in the same locality/city as the bank you will deposit the cheque into. Everything else is a mystery and you need to check with your bank as to what is what.

[jitagon]

So now we have the agent receiving the deposit, and not the seller, as has been suggested. Plus a 'booking fee'? What exactly is the booking fee for and when is that paid?

That's right, the agent receives the 10% deposit from which he can take his commission and give the balance to the seller, thus ensuring that he has his money.

When an agent shows you a property and you say you want to buy it he will ask you for a booking fee, usually around 10,000 to 50,000 depending on the value of the property. This is so the agent notifies th seller of a purchaser and puts a 'hold' on the listing and will not market it to anyone else while you raise the 10% deposit. Of course this is only a safeguard if there is a sole agent dealing with the sale.

The deposit is reduced by the amount of the booking fee so the agent only holds 10%.

What is the time line between placing the booking fee to making a deposit and then the full purchase price?

That is to say, when a potential purchaser expresses an interest in a particular property, he is then asked to make the booking fee? How long after that is the deposit to be paid? There must surely be a set time allowed, otherwise the prospective purchaser could drag it out for months. And I'm assuming that neither the booking fee, nor the deposit are refundable?

[quiksilva]

There is no set time period it boils down to whatever is agreed. If everyone has their act together and all the paperwork in order a sale could go through the same day. However, that is normally not practical for most (although it does happen) and usually we suggest that everyone shoots to effect transfer within 30 days of paying 10% and signing the sales & purchase contract. (Yes this amount is usually non-refundable)

Just for the record, in 99% of our transactions the deposit is paid directly to the vendor, who pays us after transfer is completed. Our clients are normally satisfied with our service, so getting paid has never been a problem.

Edited September 1, 2008 by quiksilva

[jitagon]

There is no set time period it boils down to whatever is agreed. If everyone has their act together and all the paperwork in order a sale could go through the same day. However, that is normally not practical for most (although it does happen) and usually we suggest that everyone shoots to effect transfer within 30 days of paying 10% and signing the sales & purchase contract. (Yes this amount is usually non-refundable)

Just for the record, in 99% of our transactions the deposit is paid directly to the vendor, who pays us after transfer is completed. Our clients are normally satisfied with our service, so getting paid has never been a problem.

How does that pan out with the booking fee? Do you charge one?

[quiksilva]

Nope. It is not our job to charge anything to the buyer, the 'booking' deposit should be paid directly to the owner upon signing the sales and purchase agreement. This gives the owner comfort that the buyer is committed to the transaction as per the agreed terms.

We hope in the future that we will be able to make much more use of the escrow system for these transactions, provided that everyone agrees and that the costs are not extortionate. Again in this case we would not handle the money ourselves, (escrow law only allows banks to do this, not even lawyers can be escrow agents), our role then would be to set this up with all the various parties and ensure that the transaction moves forward with the same intention as agreed.