All Forum Posts by: Jonathan Minerick

@Manolo D. You can definitely do that and it is how many of the developers/flippers we work with do things. For the paperwork, I've seen them use flat fee attorneys or do it themselves. You can usually also rent an MLS linked lockbox so you can skip having to send your own person over to open/show homes - just let the buyer agent do their job. If an unrepresented buyer comes along, then you can send your own person over to show it.

In general, here's the big things you want to look for in a flat fee listing:

1. The listing MUST be on the local MLS.

There are hundreds of MLSs in the United States. Sellers want to be on the MLS that covers the area where their home is located, so they can offer a commission to LOCAL buyer agents.

2. Cost to list + changes to listing.

Can range from $100-$400 for the exact same listing on the MLS. Watch out for fine print that requires an additional fee at closing. Make sure you are able to make changes to the listing after it has been posted for a nominal fee.

3. Photos on MLS.

Make sure you can upload at least a dozen photos. Some services offer a great price, but it's only for 1 photo - which is not useful for most properties.

4. Length of Listing.

Get at least a six month listing and be sure that there is no charge for cancellation.

5. Fine print.

You should never be required to use any closing service (e.g. escrow) provided by the flat fee service agent. This is a violation of federal law.

Ultimately, we've found that the three most important things when listing a home are 1) price, 2) pro photos, and 3) offering a fair buyer agent commission on the MLS (typically 2.5%).

Here's a BP blog post I did which breaks down the time and costs for a California license: https://www.biggerpockets.com/blogs/9561/55035-wha...

In a nutshell, 140 hours + $450 to get the CA license, and another $1,500 for your first year MLS/lockbox/realtor fees (based on the San Diego MLS).

As you stated, the listing agent commission is easy to avoid, just do a flat fee MLS listing (can be had for $100 in CA). You can also rent the MLS linked lockboxes for a flat fee (~$125).

When you get a license, you'd need to hang it with a brokerage to get access to the MLS. Many brokerages prohibit you from listing your own properties (E+O issues are one reason), so you'd often need to pay a nominal fee to a fellow agent in the office to do the listing.

You are way further ahead just using flat fee services. And even if you need help with the paperwork, IMO it's easier just to get a flat fee attorney to take care of it.

You can get the required agent courses online through a few different sites for ~$99 (licensesolution.com, realestateexpress.com, others).

Your best bet on the paperwork, especially for your first time, is to get a flat fee attorney - we work with one in San Diego who helps our sellers with offers, disclosures, and throughout the escrow for ~$2000. Pretty easy and straightforward.

You can get contracts and disclosures through different websites (firsttuesday, uslegalforms), often for free. Keep in mind that if you are dealing with a REALTOR®, they may want to use their REALTOR® set of forms and that's fine - just let them know you will need the seller forms. The REALTOR® forms are setup to work with the rest of the forms in the REALTOR® set, so you typically don't want to mix and match the forms from other sets (firsttuesday, uslegalforms).

You may have a hard time finding a flat fee real estate agent that will give you the blank California Association of Realtors ("CAR") forms, as it's a violation of CAR intellectual property / terms of use, and the end user agreement of their software provider.  CAR requires that if an agent provides the CAR forms for use in a sale, that agent must be providing full-service to either the buyer or seller.

Bottom line: your best bet is to get the flat fee MLS listing and wait and see where the buyer comes from. In the best case scenario, using a flat fee attorney where there is no buyer agent, you'll end up saving ~$30,000 in commissions for the typical Orange County home. Even if the buyer has an agent (we always recommend offering a fair commission on the MLS, ~2.5% in most cases), you'll still have a nice savings and be way ahead of the game.

As a buyer agent, how do you know the amount the seller is paying the listing agent? We do flat fee listings on every major MLS in California and I have yet to see an MLS that requires us to display the amount we are being paid by the seller.

In California MLSs, we can see the type of listing agreement that the seller has with the listing agent. The typical flat fee listing uses an "Exclusive Agency" listing agreement, but that listing type accounts for over 20% of listings on some MLSs. Not to mention the "Exclusive Agency" agreement doesn't always even mean it is also flat fee.

100% agree with other commenters, I've never met an agent that would not show a flat fee listing. The only time I've seen agent avoid showing a property is when they are FSBO (and not offering a commission on MLS) or they are offering a far below market commission to buyer agents on the MLS (e.g. 1%).

Just did a BP blog post on that - the costs for a license in California (San Diego specifically):

• Getting the license = $453 and 140 hours of time. 
• First year MLS, lockbox key, and REALTOR® dues = $1,660
• Continuing education every 4 years
• Transaction fees 

You can get any of the real estate services for a flat fee. The investors I work with typically go direct to the listing agent when buying a property listed on the MLS. That way they can work something out so the buyer agent commission comes back to the investor and the listing agent gets a little more so they push the deal.

In general, the big things you want to look for in a flat fee listing are:

1. The listing MUST be on the local MLS.
There are hundreds of MLSs in the US. Sellers want to be on the MLS that covers the area where their home is located, so they can offer a commission to LOCAL buyer agents.

2. Cost to list + changes to listing.
Can range from $100-$400 for the exact same listing on the MLS. Watch out for fine print that requires an additional fee at closing. Make sure you are able to make changes to the listing after it has been posted for a nominal fee.

3. Photos on MLS.
Make sure you can upload at least a dozen photos.

4. Length of Listing.
Get at least a six month listing and be sure that there is no charge for cancellation.

5. Fine print.
You should never be required to use any closing service (e.g. escrow) provided by the flat fee service agent. This is a violation of federal law.

Ultimately, we've found that the three most important things when listing a home are 1) price, 2) pro photos, and 3) offering a fair buyer agent commission on the MLS (typically 2.5%).

Let us know if you have any questions!