My Realitor wants a "PREMIUM" (side money)

[Chris Toedter]

So I am in the process of buying a multi-Family property and in the middle of the closing process my Realtor told me there is a "PREMIUM" on this property. I had no idea what he was talking about until he basically told me I want 5 to 10 thousand dollars on the side for the property. As stuff got more shady I am tempted to not pay him at all I was going to give him a thank you bonus but this makes things very different in the 1 the relationship and 2 the business I want to do going forward.

Any suggestions or this every happen to anyone else?

[Andrew Johnson]

Chris Toedter First off, I wouldn't pay. No, heck no, I wouldn't pay.

I will, however, take a guess at what's going on. Your realtor thought it was a 6% commission split 3% each. The seller signed an agreement for 5% commission and the selling agent wrote up 3% for their split and is, thus, leaving only 2% for the buyers agent. The buyer's agent is now trying to recapture the 1% from you "on the side".

If that is the case then the realtor had every opportunity *not* to work with you on a property where the might end up with a lower commission. I wouldn't blame a realtor for doing that, it's effectively a 33% cut in their gross fee. But I would blame them for coming to you after it's under contract.

I did have something similar to this come up on a HUD-1 that a title company put .5% as a buyer expense to give my realtor 3% and the selling agent 3.5%. Obviously, I didn't pay the .5%.

Then again, I'm just guessing. Either way, I wouldn't pay. Heck, I might call the listing realtor and say "My agent is demanding a side fee of $10K so I'm pulling out of the deal." Grab some 🍿 and see what happens....

I would be curious if these requests are just verbal or coming in emails from their work email account. Anyway, I'm sure other realtors will comment, maybe this is common...