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here's the rub:
met a broker at open house months ago. broker emailed me various listings from time to time (never entered an agreement w/ broker). tipped me off to a particular apartment. viewed particular apartment w/ broker in april, met owner while there and let it be. broker emailed me last week and i inquired about the apartment that we viewed. it's still available. we told broker we would like to offer X. broker said we would need to fill out application, etc in order for broker to present our offer. haven't received paperwork and haven't heard back from broker in 3 days.
the day after i told broker we wanted to make offer i ran into owner in front of the building. introduced myself as someone who viewed apartment two months ago, chatted a bit about the apartment, discussed prices, etc. owner told me "you don't need to go through that broker" and said I could stop by and he/she would show the place to me again.
am hoping to negotiate w. owner directly from this point forward. if i do so successfully, do i owe the broker anything?
Screw the broker.
If they can't get back to you, then you shouldn't neither.
Yes you do - it will probably be quicker and easier to go right through the owner, but if/when the broker finds out, one of you is getting a bill.
Sounds like a lazy broker, but you will still probably owe him if he finds out.
for anyone else... unethical... for you, save the 6% :)
Sorry, but the rules (as unfair as they are) are in play here, I am so sorry to tell you that. On the other hand, there are plenty of fish in the sea.... you may look back on this and say it stopped you from over-bidding. IF you really really need to bid, just bid what you would've minus the 3%, the last time I checked it's a buyer's market.
next time as a buyer, you need no brokers (except if you intend to use the broker to make your bid more legit and hammer him on the price)... basically it gives you a 3% advantage over all the other lemmings w/ brokers :)
thxs for your support and how's the pregnancy going?
If uwsmom never signed an agreement, then they likley never talked about a fee. If that is the case, she could fairly assume the that the broker would be paid by the owner. Since the broker flaked on her, I would think the broker's beef would be with the owner and not the potential renter. Either way, just get an agreement from the owner that they will deal with the broker if the broker tries to collect a fee. As long as the owner knows the story, I think it is fine.
W67- feeling so much better these days. Thanks! Should have mentioned that it's a rental in a rental building.
There's more weirdness involved. It's unclear what the relationship is between broker and owner. I don't think the unit is listed with the broker's firm. Broker is kind of shady. Owner is odd/quirky. I think broker was showing another unit in the building and owner mentioned that the one we're interested in was available. It's all strange....
Also, my gut tells me that broker thinks our offer is too low and isn't interested in presenting it. I told broker that if we weren't in the ballpark, we didn't want to waste anyone's time (w/ application, etc). And, haven't heard back, so....
My gut also tells me that the same offer might fly with owner directly.
Just unclear what role broker may end up playing in the end. Obviously, this is something I would discuss w/ owner.
If the owner owns the whole building, I would listen to them (but still get them to agree they deal with the shady broker if they pop up and ask for a fee). I wouls also double check anything the broker gave you including all emails to make sure there is no language on paying them a fee for a building they show you.
a thank you note and a nice bottle of wine?
Under what circumstances do owners owe brokers anything?
I suppose if the entire building is under contract with a firm, then there's no question.
but, if it's unit by unit, is it a different story?
would the two of them need to have a signed contract in place for broker to try to collect a fee?
the broker does sound lazy...in this market he/she's crazy not to have e-mailed you the application immediately. If the broker's going to cause you problems maybe you can work out the fee with the owner..split the reduced fee down the middle. Whatever the broker gets he's lucky since you and the owner closed the deal without him.
admin - that was my thought too. actually, hubby and i were thinking of being far more generous (maybe drop $1k), but if i never hear back from broker, its a different story.
When you say three days, are you talking three business days (ie he's had since last Wed) or are you including the weekend? If the latter then you're jumping the gun on accusing the broker of dragging his feet.
Also, if you've ever signed an agreement with the broker (as most rental brokers require before they begin to show you listings) you will be on the hook for his commission regardless of whether you now negotiate directly through the owner.
i'd put the $1k in a coverdell ESA for the new baby. expressing gratitude in some form would be nice though.
Whether you signed an agreement or not is not really a reliable get-out-of-jail-free card - If they came after you for the commission and escalated the situation to a court hearing, most any court in NY would assume that you wanted to use their services when you asked them for listings and tried to submit an offer through them.
I would start making some detailed notes regarding the timeline of the whole apartment search and offer process, so that, should he come asking for his cut, you can illustrate to him that having tried to negotiate through him as a broker, that he voluntarily chose not to be party to the transaction either through inaction, undue delay, negligence, whatever (you know the details better than us) - Just have a prepared argument about how they blew the deal.
If I was working with a RE agent that showed me the listing there is no doubt I'll stick with him. I think that bypassing him will be unethical, personally. I don't use a broker for that reason...
thanks Matt. That's helpful.
we don't use a broker either. never asked for listings (i.e. search results). met broker at an open house and was sent listings afterward. I've had many brokers from open houses send me listings. they're typically (95% of the time) listings that i've already come across.
broker "mentioned" one apartment that he/she "knew about"...never sent us a listing for it. we did, however, choose to view this apartment with this broker. would not have known about apartment otherwise...
mimi - how do you see places if you don't "use" the listing broker to view it?
Sorry uwsmom, I was under the impression that you were working with him as a buyside broker. In this case, I think it becomes the seller's problem, not yours.
I hate to say it, but if you viewed this actual apartment with the broker then you technically should be going through him for contracting. Keep in mind that the piece of paper you signed when you met him at the open house (brokers like to trick you by calling it a "sign in sheet" or something like that) is actually a legal document. Unless the building in question is no fee, then YOU will recieve an invoice from the broker if he finds out you rented the place.
In New York, if there is no contract for commission AND there is no exclusivity agreement btw broker and the owner, the broker must prove:
(a) he/she is a licensed real estate broker (not just licensed sales person) or attorney; and
(b) he/she was the procuring cause of the sale (just introducing buyer and seller or causing agreement to price is not enough).
Based on the facts you've provided, if the owner offered to cut out the broker, there is probably no exclusivity agmt btw them (ask the owner). And, because you're not at the end point of negotiations, the broker is hardly the procuring cause of the sale.
This I remember from bar exam review a few years back (pieper bar review is excellent!), but is not intended as legal advice. Just sick of seeing so much misinformation spewed across the boards. Hope it helps, good luck!
This is a Rental, so the rules of sales do not apply of buyer/seller brokers.
It is possible that this broker does not have access to the owner and was not suppose to be showing this apartment to begin with. This could be the reason why he hasn't gotten the documents. He cannot get in touch with the owner.
I would proceed with the owner carefully. If he doesn't get you anything by end of week, you should be in a clean.
In sales, I think that there's a 3 month rule (so I've heard). If the broker shows you the apartment and you decide to make an offer within the 3 month period, you need to deal with them. After that, you can deal with whoever you want.
UESbandit - the "sign in sheet" was for a different apartment, not the one we're interested in. we've signed nothing relating to this apartment.
ab11218- the owner was present when the broker showed us the apartment initially.
bottom line, I need to discuss obligations to broker with owner when we meet.
i hope you get the apartment and have a terrific baby!!
Thank you Julia! :)
The question is, am I being unethical?
The answer is yes. Maybe you didn't sign a contract, maybe your broker is a lazy agent or, maybe from a legal stand point you might be able to bypass the broker but, that's not the question.
The question is, am I being unethical?
The answer is yes. You knowingly entered into a relationship with a service providing professional. That service was rendered...in what seems to be a slow but ultimatly satisfactory manner (you get the apartment you want). When you went out looking, you knew the deal. Now your looking to cut the agent out. Totally unethical. Don't bring bad MOJO to this deal. What goes around comes around.
Don't what to pay a fee? DO IT ALONE from here going foward.
the broker in question is, i think, the listing broker (or as close to one as this owner gets), not MY broker, but i hear what you're saying falco. however, how do you propose to "do it alone"? With the exception of this apartment (which seems to be off the books/unlisted), i see all apartments solo. However, I do have to interact with listing brokers to get in. No one can "do it alone". Trust me, I'd love to!
we plan to be honest with all parties involved. though, i do think i will get farther negotiating directly with the owner. if we settle on a deal, the broker will be informed.
I suppose I'm concerned with the following scenario:
Assume the owner/LL says that broker is NOT the listing broker and owner has no obligation to the broker. Assume I can successfully negotiate and sign rental agreement with owner.
I have not discussed fees with this broker and can honestly say i am/was under the impression that broker worked for owner (not me!).
Where does that leave the broker? It does feel kind of wrong that the broker could potentially end up with nothing.
a) I agree with falco and w67 re; "is it ethical"
b) i think a lot of the answers in this thread assumed a sales listing and are not germane as a result.
c) I can just about guarantee you that the4 broker is not the "listing broker" in this case (if he was, the LL wouldn't be trying to cut him out because he'd be paying him anyway.
d) Similarly to what I said in another thread about advising landlords to be wary of talking renters who went around their brokers, i offer the same advice about landlords who tell renters "go fuck your broker". they will probably have the same thing to say about you when you want a repair done, your full security back, etc.
e) If the way you are putting it is 100% accurate, your broker does to some extent deserve it a little bit because if you are dealing with a listing where you aren't 'protected' as a broker, you better make damn sure you submit offers, etc. in such a manner as to avoid getting fucked. OTOH, "hearing b ack in 3 days" cold mean you left a message on Friday after he left for the weekend: if it's 3 business days, it's a very different story than if it's since late Friday.
f) If you met the broker at an open house, they probably, or even more than probably, were the listing broker on that unit. Was that unit a no fee unit? If you met them for an open house for a no fee unit and they sent you other listings without discussing a fee, they screwed up because i can't say that a renter in such a situation couldn't genuinely believe under such circumstances that other listings offered would be no fee as well (but from the way you are telling it, at some point or another the broker told you, and you acknowledged, that there was some fee to be paid on this unit. So if we're talking about a situation where you actually acknowldged to this broker that you understood that you would owe him a fee if you rented this unit, it's hard to both not pay him anything and still be "ethical").
uwsmom - just an opionion here, more on the ethics point than the legality:
1) You did not promise the broker anything, thus you do not owe him anything. Not the least bit unethical. You didn't ask him to send you listings, but he did anyway. That's like saying I "owe" the bum that opened the door for me at my bank today money because he did me a service. He did something I didn't ask for, didn't need, and did it to guilt me into giving him $$. Sound familiar?
2) You mentioned yourself that the broker himself was shady. If i read your narrative right, he implied that it was his listing, when it wasn't. Rest assured, ethics are the last thing from this broker's mind, which unfortunately also holds true for a significant majority of brokers, some exceptions that post on SE notwithstanding.
I think you have zero guilt here, talk to the owner, be very upfront, and I hope it works out, whether through this apartment or another one.
P.S. Easier said that done, but the way to avoid this situation is ALWAYS to ask a broker when they show you a listing you like: "Are you the listing broker?" "What is the address?" If the answer is no or "I can't tell you" make them go away. Yes, you have to deal with the listing broker if there is one, but you don't have to deal with any of the other scum, although they're pretty persistent in trying to get in your way.
30yrs - yes, 3 days was Friday to Monday, however I received some (annoying & unrelated, IMO) correspondence from broker on Sat. We're not talking about a school teacher here. many people work, or at least check email, over the weekend.
still haven't heard back as to whether broker plans to send me application or not. unprofessional? I think so.
in any event, this could certainly work to our advantage. if another day or two go by w/o word, its pretty clear that the broker is CHOOSING to not work on this for us. People don't get paid when they choose not to complete a job they've been asked to do. Choices and consequences. End of story. We'd be happy to pay for the hour that it took to show us the place.
newbuyer - thanks for your thoughts. and i totally agree that i need to ask more questions next time. when a broker tells you that an owner will only work with them, it's not unreasonable to assume they are the listing broker.
and i did try to view this place solo before asking the broker to show it to us. doorman made me leave name and number. didn't hear back so we asked broker to show it to us.
"and i did try to view this place solo before asking the broker to show it to us. doorman made me leave name and number. didn't hear back so we asked broker to show it to us."
Then in my view there's is no question that there is unethical behaviour going on here. You can own it all yourself, split it with the landlord, or make the landlord eat it all, that's up to you, but it's hard to argue that it isn't occurring in some form or another.
it's a tough world.
From your latest comment it looks like you always intended to screw the broker and simply made the original post here looking for a bunch of people to tell you it was ok.
My 2 cents.
One of our past rentals was found through the current tenant. We tried to contact the owner directly to avoid paying a broker fee. The owner told us he had a contract with the broker - so even though we found the place without ever meeting the broker, we still had to pay his fee.
It's an owner/broker issue. If the owner is willing to rent to you directly, you should make sure he/she has no contract in place with the listing broker and get assurance that working directly with owner = no fee.
I know somebody who got SCREWED in a similar situation. The seller (an estate) accepted an offer from couple X. The estate told couple X that if they waited 30 days, the agreement with an exclusive broker would lapse and they could have the apt. 30 days later, Couple Y bid more for the apartment. No docs to prove otehrwise -- left out in the cold. Does the seller have a broker? Or is the owner selling directly? Any emails between you and the broker? Cell phone records?
People who try to cheat others often are surprised when they get screwed. That said, if the broker is not calling you back -- move forward on your own. Good luck...
you're wrong 30 yrs. we plan on keeping the broker informed (i.e. informed that he was essentially squeezed out of the process due to unprofessionalism)
am i going to lose sleep over the fact that this broker screwed himself out of a fee? hmm, let's see. I did have legitimate concern 48 hours ago, until the broker decided to ignore our request. now, i could care less that he could end up with nothing.
and, yes, i try to avoid using brokers if i can. sinful?
my subject heading may be misleading; i really don't look for moral guidance on SE. shocker, right? i was, however, interested in other's opinions on the matter. seemed a little sticky until the broker flaked.
now this is nagging me...or is it that i'm just not ready for bed...
when i ran into the owner a few days ago and discussed the apartment, i said to the owner that i would contact the broker to come back and see the place. THAT is when the owner told me not to bother. should i have looked the owner square in the eye and said, "no, i insist that the broker show us this place again and be privy to all negotiations henceforth"? LOL. who am i to tell the owner who's involved and who isn't?
or maybe you could have asked him "Are you just looking to screw this broker, or are you the type of guy who likes to screw everyone and you'll do the same to me when the time comes?"
Do you have the owner's email address? Email him/her and ask him what you just asked everyone. Get his/her answer in writing. Then go ahead, negotiate w/o the broker. At the end of the day, you wouldn't be liable because of said email.
"My 2 cents.
One of our past rentals was found through the current tenant. We tried to contact the owner directly to avoid paying a broker fee. The owner told us he had a contract with the broker - so even though we found the place without ever meeting the broker, we still had to pay his fee. "
See, now this is something I find to be unethical and I'm almost positive used to be illegal (I don't know whether the law actually changed, the AG made some ruling, or they just decided the business had changed and weren't going to bother with these cases anymore). If the owner wants to have someone be HIS broker, then HE should be paying them. how can he have an exclusive agreement with them, but YOU are the client?
do i really need a buyers broker for new development? would i have more negotiating power with the developer if i didn't have a broker?
unless you have a really good buyer's broker, odds are no. perhaps now a little more than a year or two ago, when basically NOTHING was negotiable, so who needs a broker for a "take it or leave it" deal? this, however, assumes you've already decided to buy in that development, which is rarely the case - so the reason to have a buyers broker is more to show you the alternatives and give you advice on them, etc. So, if you think it's ethical to run around a buyer's broker getting you all sorts of info, showing stuff, etc. and then go buy something you already knew you were going to buy and have them earn nothing for the time they spent with you, it's your decision (but I posit if you do, you forever forfeit your right to pull the "brokers are unethical" card).