Newsgroups: alt.realestate.business alt.realestate.fsob alt.realtor
Subject: Set Commission Based On Difficulty to Sell???
From: "Baird Spalding" 
Date: Sun, 5 Oct 2003 22:52:42 GMT


On  5-Oct-2003, "Don Zimmerman"  wrote:

> >> As I understand all these things make you a greater risk with a
> > corresponding higher interest rate. To say they're charging more because
> > it's "harder" should insult your intelligence. It also ought to tell you
> > about their level of experience. It may be harder for a broker with no
> > sub-prime experience, but it's not harder for a competent broker.
> >
> > > self-employed or unverified income
> > > As I understand it, all these things make it harder to get a loan.
> >
> > Yea sure, it's harder to not document a loan than to document one.
> >
> > But you've given me an idea! I'll charge more commission for one
> > bathroom
> > homes because they're harder to sell. Wait! That orange paint, that'll
> cost
> > you another 2%. Hope you spanked little Johnnie good, that vomit stain's
> > gunna cost you 1%.
>
> Yes, I see your point. Greater risk should entitle the lender to a higher
> interest rate, but it might not affect the amount of work done in finding
> and processing the loan. I am not sure about that.

If mortgage brokers have been getting away with the "we charge more for
harder to approve loans." And you seemed to accept it, and judging from your
posts, you're no fool and you're in the business too. I wonder if that
method would fly in the real estate business. I wouldn't mind taking 1% if
the home would sell in a few days with relatively little interaction with
the sellers or agents. When it stays on the market I not only have to call
the seller on a weekly basis at the very least. I need to follow up on the
showings, send messages to prospective buyer's agents etc. It seems like not
only a good marketing angle, but a sound business decision. Some sellers are
getting screwed at 6% while others have caused me so much time and expense I
should have charged them 20% or walked away. I occasionally agree to lower
commission or pay a seller's bonus in exchange for them lowering the price
and or cleaning up and doing cosmetic work on the house and it's worked well
in every case. Why not do it up front?

It doesn't seem fair to charge everyone the same. Just wondering what you
all think about keeping the commission open until an evaluation is done or
even have it based in part on how long it's on the market.