Selling house - flat fee MLS or full service agent

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Selling house - flat fee MLS or full service agent

Dave Mustaine
Aurora, IL · Member since 2014 · 45 posts · 1 vote

I'll be listing my house in Aurora, IL In a few weeks. I found a realtor with tons of current listings and past sales who will put me on the MLS for $100. Very high volume realtor. He also gets $200 of the buyer agent commission upon closing. He sent me the MLS input forms and I know all the answers, two other exact models recently sold. The only thing he does is takes offers and counter offers. I'm suprised he does this for only $300 total compensation. What's the catch? I'm planning to try this to save a few grand but want to make sure there isn't a big reason to not do it. Here is some info and then a few questions.

I'm not working so I don't mind taking all the calls to schedule showings and questions.  I bought a lock box at Home Depot.  I'm going to hire a photographer.   I have a lawyer. I already wrote my ad.  There will be no major home inspection issues.   House is 15 years old in great shape.  I know how to stage it.  I'm a good negotiator.  Is there anything else an agent could do for me that would be worth over 3k?    Is there anything I need to worry about? 

The flat fee listing agent said he will put my name, email, and phone number in the area on the MLS for the showings contact. If someone contacts me for a showing or questions, can I be certain they are an agent and not a thief? Im worried about giving the lockbox code to anyone who is not an agent.

Hmm, the listing agent said. If anyone contacted him outside of the MLS he would forward the email to me. However, I suppose a buyer or thief with no agent could call him and ask for my info. is there a fast simple way to screen people to make sure they are an agent? What should I ask? I don't have a fax machine.

Should I eliminate buyers with no agent since I have no agent to do the work.  Anything else to worry about?  Thanks! 

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Anthony Micklus
Real Estate Agent · Milton, VT · Member since 2015 · 81 posts · 36 votes
10y

Hi Dave, First full disclosure I am a Licensed Realtor (in Vermont) From what I am reading you sound like you can do a lot of what a Full Service Agent can do. If you are on MLS you are getting access to all the agents buyers in your area and Zillow, Trulia and Realtor.com pull from MLS so you will be there. My only piece of advice is to make sure your commission award to the buyers agent is competitive with the local market. I never choose what to show my buyers based on the commission spit but there are agents that will. As far as eliminating buyers it depends on your contract with flat fee. Usually the listing agent gets the commission for the buyer if the buyer is unrepresented but I don't know how it works with Flat Fee. I wouldn't worry too much about the thief thing a thief disguised as a buyer can call an agent just as easily however I would suggest that you have the buyers First and Last name, Phone number and Email before you allow them to view the hose.

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  • Anthony Micklus
    Real Estate Agent · Milton, VT · Member since 2015 · 81 posts · 36 votes
    10y

    Hi Dave, First full disclosure I am a Licensed Realtor (in Vermont) From what I am reading you sound like you can do a lot of what a Full Service Agent can do. If you are on MLS you are getting access to all the agents buyers in your area and Zillow, Trulia and Realtor.com pull from MLS so you will be there. My only piece of advice is to make sure your commission award to the buyers agent is competitive with the local market. I never choose what to show my buyers based on the commission spit but there are agents that will. As far as eliminating buyers it depends on your contract with flat fee. Usually the listing agent gets the commission for the buyer if the buyer is unrepresented but I don't know how it works with Flat Fee. I wouldn't worry too much about the thief thing a thief disguised as a buyer can call an agent just as easily however I would suggest that you have the buyers First and Last name, Phone number and Email before you allow them to view the hose.

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  • Dave Mustaine
    OP
    Aurora, IL · Member since 2014 · 45 posts · 1 vote
    10y

    Thanks!  Much appreciated.   I will give the buyers agent 2.5%, which is the going rate in my area.  Is there a way to quickly screen an agent to make sure they are an agent?  I thought about having them scan and email me their business card, but they could send me anyone's card. 

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  • David Faulkner
    Investor · Orange County, CA · Member since 2015 · 2k+ posts · 3k+ votes
    10y

    I recently did this and overall it worked great. Anthony gives great advise to offer market (or even slightly above market) commission to the buyer's agents. Also, you can get a lockbox at home depot for under $30 and give the combo to agents when they call if it is vacant and you are comfortable doing this after verifying they are legit agents. This makes it easy for them to show your property and cuts the workload on you. To verify, have them text you a picture of their business card, it should have their DRE# which you could look up, and the cell phone number should match the number the text is coming from. When they call, text them your email address as well as the lockbox code to make 100% sure all offers come to you as they will not likely be your flat fee agent's top priority. Lastly, read the fine print in the listing agreement very carefully to make sure there aren't hidden fees, add ons, or gotchas. It should be a non-exclusive listing agreement.

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  • Stephanie MedellinBusiness Member
    Mortgage Broker · CA · Member since 2014 · 1k+ posts · 644 votes
    10y

    Hi Dave,  Would it be possible that the agent could place a Supra or other electronic lockbox on the home, even if he charges an additional fee for this?  Only licensed agents would have access to open it, and it does not require any codes to be given out.  If a combo lockbox is used on a traditional listing with a listing agent, the code is generally not given directly to buyers for the same security reasons you're concerned about.  To screen agents you would ask for a license number, name, and brokerage name.

    I would not recommend eliminating any buyers, agent or no agent!  You will probably find that those who do not have an agent have not been pre-approved yet, and you may have to do some additional screening.  I would not accept or even negotiate any offers until I saw a pre-approval.

    [email protected]
    Stephanie Medellin, Loan Factory58 Reviews
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  • David Faulkner
    Investor · Orange County, CA · Member since 2015 · 2k+ posts · 3k+ votes
    10y

    Oh, and be prepared to get 1,000 cold calls from realtors trying to convince you to list with them. You'll know right away because they will want to talk about why you're selling, how long you are prepared to wait to sell, they are doing a survey of homes for sale or other such BS. On the other hand, an agent wanting to show your property to a client will get straight to business setting a viewing appointment rather than chit chatting.

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  • Darrell Lee
    Investor · Springfield, VT · Member since 2014 · 158 posts · 75 votes
    10y

    Not all MLS have special keyed lockboxes. In Vt and Nh, they just use regular combo lockboxes. I buy them by the dozen on Ebay... but I own houses in 4 states and not a broker anymore, just a principal.

    Being from California, Vt and Nh do things very differently so I do hire listing agents and transaction lawyers and have learned a lot from them.

    Last year I bought a dozen houses sight unseen... 3 of them I still haven't seen yet and it's been over 6 months since closing... lol They were too cheap and I probably shouldn't have bought them as they probably aren't worth my time as I'll probably only make about $10k each instead of my usual $50-100k each...

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  • Ali Barghelame
    Investor · Denver, CO · Member since 2016 · 6 posts · 1 vote
    10y
    Just google them. If they are legitimate agents, something will come up. You can also verify with their regulating body that they are licensed if you are worried.
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  • Crystal SmithPro Member
    Moderator
    Real Estate Broker · Chicago, IL · Member since 2014 · 2k+ posts · 1k+ votes
    10y
    Originally posted by @Dave Mustaine:

     If someone contacts me for a showing or questions, can I be certain they are an agent and not a thief?  Im worried about giving the lockbox code to anyone who is not an agent. 

    is there a fast simple way to screen people to make sure they are an agent?   What should I ask?  I don't have a fax machine. 

    Should I eliminate buyers with no agent since I have no agent to do the work.  Anything else to worry about?  Thanks! 

     My recommendations:

    • Pre-approved buyers- Whether a realtor or a buyer not working w/ a realtor you must request a Proof of Funds and/or Lender Pre-approval letter before showing the property.  Without this you may end up wasting a lot of time sharing the property w/ people who can't close.  
    • Security & lockbox- Since Sentri locks are only available to realtors you may want to research smart locks.  You can control the locks remotely.  You may want to combine the lock w/ ADT Security web cam or set up your own web cam for a record of who enters the property. It's more expensive than just putting a lock w/ a lockbox but you can sell it as a feature of the home while satisfying your need for safety/security during the sales process.
    • Regarding a fax machine- We don't have a fax machine either but we still work w/ some Luddites who use faxes.  We use on line resources for faxes.  There are a ton of them.  Find one that you can use for free during the short time your home is up for sale.
    312-681-7487
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  • Jim Keller
    Investor · Riverside, CA · Member since 2014 · 351 posts · 220 votes
    10y

    In Southern California we primarily buy, fix, and sell I think an agent is necessary for time leverage. We always price our home in the mid, to high range to get our phone to ring.   Our homes typically show as the best available homes in there specific sub-market.  Our agent partners work to drive the price up as much as they can. sometimes its not price, its finding the best qualified buyer.  What ever our goal for selling the home is, the realtor is responsible and has all the stress to perform.

    I read comments about having enough time in your day to sell the home yourself and save what, $15,000 I think your kidding yourself.  If your phone is not going off for a possible purchases on your next deal you are going to be sitting for months "finding" the next one, if your waiting to sell the first one.  Not a good thing to wait to make your next deal.  We always make more on our next deal that any saving we would make selling our self.

    I was an agent for years, making the switch from agent to investor was difficult for me. completely different skill and mind set.  It would be a mistake for me to deal directly with a buyer that some how thinks a PAINT JOB, SMALL CRACK IN CONCRETE, SHOWER ENCLOSURE is a reason to not buy a home.  I just cant waist my time with it anymore, or the buyer that wants 3,000 sq ft home with a view and a pool but has no money down, and need payment assistance.  This is the client that also wants me the seller to "help" with a first time buyer program.  I can't do it all, "big realization"

    Let the great quality agents work all these deals out and partner with them to get you top dollar for your home.  Or have them get you out of a deal you just don't want to own any more.  Leverage them, and your time and make more money with the same effort you used before.

    Go to my agent marketing website by clicking below.

    Click here for some marketing our agents did for us.

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  • Mike CumbieBusiness Member
    REALTOR® · Brockport, NY · Member since 2015 · 3k+ posts · 4k+ votes
    10y

    Hi @David Faulkner,

    He is going to be listed already by an agent with access to the MLS so I wouldn't expect any cold calls. In our area it is unethical to solicit business from another agent who already has a listing agreement (Which he would have with a discount listing broker).

    Now a FSBO, I call them all the time, I am not looking so much for the listing though and don't drive the conversation in that direction. I want to know if I bring them a buyer will they pay a commission? If not no biggie, I just have to let the buyer know that if they choose this house they are responsible for the commissions.

    If I have a specific buyer I will go tour the house without them first to make sure any paperwork is all set. 

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  • Jake Thomas
    Residential Real Estate Agent · Grand Rapids, MI · Member since 2013 · 803 posts · 689 votes
    10y

    Not sure how the flat fee agent gets $200 of buyers agents commission. This sounds like an admin fee you are paying. If you are worried about giving out the lock box code to strangers then maybe the flat fee way isn't for you. You never want to not let someone see the house because they don't have an agent. If you had a full service agent they would show the house to the prospective clients. Otherwise it should just be other agents bringing their clients through. The flat fee agent will pass offers and counters to you but likely won't go over in detail any of it with you. Yes, you can hire an attorney but paying a Realtor might be cheaper. I am not knocking on the flat fee guys, they have their place in the business but you get what you pay for as well. 

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