Cracks in basement block walls

[Mac]

We're in central Illinois, if that helps.

[Mac]

Oh my gosh, we were warned NEVER to deal with the listing agent. Again, live and learn. Next time, I'm doing my own inspection (along with the required hired inspector), hiring a buyer's agent, and passing up any house that won't let me get up on the roof (or at least a ladder), empty the closets, and maybe camp-out in front for a day or two. Oh yeah, and I'll pass on the third bedroom to get a my fireplace back.

[trader4]

This is just nonsense. A buyer's agent is typically compensated by the seller. The seller has an agreement with the listing agent that typically says that agency gets 6% when the house is sold. If a second broker is involved on the buy side, then that agency splits the commission and gets 3%. The agreement with the buyers agent specifies that they have a fiduciary responsibility to the buyer, to represent their interests, but may be paid a commission by the seller. Unless you get into some strange arrangement, where you yourself as buyer are going to pay an agent, that's how it works. And since at 3% the agency gets $9K on a sale, how many real estate agents are going to screw around with some reasonable low fee that the buyer would pay? Answer: no good ones. How much would you personally pay an agent?

Now, is that arrangement perfect? No, but it works provided you use some common sense along the way.

By dealing with only the listing agent, you then get into dual agency mode, where they represent both parties and keep the full 6%.

[trader4]

The problem is not as much as who you deal with as it is in knowing who it is you are dealing with. I don't look to a real estate agent for advice on how to fix foundation problems, how to get a loan, or much of anything else, except maybe providing me with some comparable sales data and serving as an intermediary. It's a lot easier to tell a real estate agent that you think the kitchen sucks and the bathrooms need to be remodeled and thats why your offer is what it is. They can then take that to the seller and perhaps help explain that it isn't unreasonable, that other similar houses do have better kitchens, etc.

I'd prefer to deal with only the listing agent. Why? Because they have a 6% commission coming. With no other broker involved, if I make a low offer, as part of the final negotiation, it's not unusual for the listing agent to be willing to cut their commission to make the deal happen. They can get 4 or 5% and still be better off than if they had to hand 3% to another broker. Or they can get 3% and be no worse off. What would they rather do? Kick in $5K in commission cut that doesn't really cost them anything and have the deal done, or work 6 more months trying to sell it, perhaps without success?

If you get a buyer's agent, they are typically going to be paid out of that 6%, getting 3% They do have a fiduciary responsibility to represent your interests. But, does that mean that you should tell them the highest you will pay for a house they've found? I think not. Unless you pay them by the hour, which I've never seen, they still have an incentive to get the deal done and over with, don't they?

[jJim McLaughlin]

SNIP HAPPENS

Commission rates in the RE world, and the splits, are almost as opaque as what goes on at a car dealership.

Around here (Portland, OR) the "common" residential commission charged a seller is 7%. Everybroker save one charges that rate. Of course, its not price fixing. Yeah, right.

In the typical transaction, the listing agent and the selling agent are not the same. The listing agent and the selling agent frequently work for different brokers.

In the typical transaction around here, the listing agent's broker gets

3 1/2% and the selling agent's broker gets 3 1/2 %. The listing agent gets whatever part of that 3 1/2 % that is in the employment contract between the broker and agent. Usually only 1% of the sale price, leaig the broker the "long piece" or 2 1/2 % of the sale price. A really reallysuccessful agent can sometimes get half of that 3 1/2 %, or 1.75%, which is .0175 of the sales price. Same split on the selling agent / selling broker side of the transaction.

Around here, agents pay "desk rent" to broker to have an office and phone / secretarial support. Brokers will pay or ads for houses, sometimes to be reimbursed through sale proceeds.

Brokers around here take a few extra state licensing exams, have to have larger surety bonds, and as a practical matter have to have the capitol to outfit big offices and pay onging operating (electric, phone lines, office rent) expenses.

The money is in being a broker.

[Mac]

Can I ducktape over the cracks for a few months? It's freezing down here, like the other night it was 61 degrees. A space heater helps but ducktape takes less electricity.

[Oren]

I prefer Duct Tape over the Duck Tape.

Just my aged bias:-))

Oren

--

[Una]

No, it is not nonsense. Just outside your own experience.

Yes, and therein lies a built in conflict of interest, because it is in all the agents' interests to obtain the highest possible purchase price.

In any case, the devil is in the details. Apparently the OP signed no agency agreement with "his" agent, so in some states his agent would not be his however he says he is in Illinois. There, according to

, in his case a presumed agency may exist. Or not, depending on what exacty "his" agent told him.

Una

[Oren]

OP has no Contract with his "agent".

Oren

--

[cshenk]

I dunno, but taping ducks to it might be pretty messy (grin).

[Oren]

Not near as messy as installing a kaa-newt valve in a duck.

Essentially, it allows air out and prevents water from entering, after the bird has landed on the lake.

YMMV!

Oren

--

[Mac]

Oh yeah, you guys are hilarious! Actually, "ducttape" just didn't look right. Heck, nobody uses it for ducts anymore. My brother calls it rock and roll tape. My daughter calls it miracle clothing mender tape.

[Mac]

Just found this on the Illinois Association of Realtors website:

"The Real Property Disclosure Report form is a series of questions intended to have the homeseller disclose any known material defects about the property. Under the Act, a material defect is defined as a condition that would have a substantial adverse effect on the value of the residential real property".

Of course I guess they could claim that they didn't know the cracks would affect the value of the house, but knowing what this man used to do for a living, I'd have to say that's improbable, (I just don't feel right posting it online).

Also:

"The seller and the seller alone is responsible for completing the disclosure form and shall be responsible for honestly disclosing only those matters of which the seller has knowledge".

He knew.

[trader4]

Let's see. I'm the buy side agent and the asking price is $200K. That means my agency gets $6K and I personally may get $2500. Now, what's in my best interest? To screw around getting $200K instead of $190K? Let's see, that works out to a whopping difference of $125 in my pocket. Big deal. In reality, the real motivation is to get the deal done quickly. Same thing on the sell side. You think the selling agent wants to screw around and lose a deal over an insignificant change in their commission because the house sells for $190K instead of $200K?

As I said, unless you're paying your agent by the hour, a similar conflict of interest is there regardless of who pays the agent. And in my experience, as follows is how it works when someone uses a buyer's agent. A buyer who wants to use a buyers agent signs an agreement with that agent that spells out the agents fiduciary responsibility to the buyer. They are there to represent the interests of the buyer, not seller. It also spells out that they may be compensated by the seller, which is what normally happens. On a listed property, they wind up splitting the 6% commission, 3% to selling agency, 3% to buying agency, part of that in turn to individual broker. Now, is that system perfect? No, but it's what's commonly done.

I'd be happy to hear exactly how you've seen buyer's agents relationships done and how they get compensated following the above example. Meaning the available house is listed by the seller with some other agent, buyer retains a buyers agent. Who pays who what?

No, it doesn't depend on what his agent told him. The Illinois law is clear that unless he has in writing otherwise, his agent does in fact have a legal, binding, fiduciary responsibility to him, not the seller.

Agency A legal framework that allows a person to act through a representative. Common examples include

o An attorney representing you in a business transaction

o A stock broker buying and selling investments on your behalf

o A real estate broker assisting you in buying, selling or leasing real estate

Under the Act, your real estate agent will owe you certain statutory duties that are similar to fiduciary agency duties.

Designated Agency in Illinois Real Estate Transactions An arrangement where one or more agents from a real estate brokerage company are appointed as your legal/designated agent. You will be presumed to be represented by the real estate agent you are working with unless you have a written agreement otherwise

Other associates in the brokerage firm may be designated agents for other buyers or sellers and may be the legal agent of the opposite party in your transaction

Even though your brokerage agreement will be with the real estate brokerage company, you will have a designated agent(s) to act on your behalf

Designated Agency Duties under the Act Perform according to the terms of your agency agreement. Promote your best interests as follows: o Seeking a transaction that meets the terms of your agency agreement or that is otherwise acceptable to you

o Presenting all offers to you and from you unless you direct your agent otherwise

o Disclosing material facts about the transaction that the agent actually knows about and the information is not confidential to someone else

NOTE: Material facts will typically not include information related to property that is not the subject of the transaction, that is a fact situation not related to the subject property or occurrences related to the subject property

o Accounting for all money/property received from you or for your benefit

o Obeying your lawful instructions

o Promoting your best interests above the agent's or someone else's best interests

Exercise reasonable skill and care in performing brokerage services

Keeping your confidential information confidential

Complying with the Act and other laws that might apply i.e. fair housing and civil rights statutes

[INSPECTOR via HomeKB.com]

In the military it is "100 mile an hour" tape.

[aemeijers]

Is it time for the annual 'duct tape thread' again, already?

aem sends...

[Big_Jake]

This wasn't a skyscraper, it was an 860 sf house. Expert testimony cost less than $700, and the attorney's fees were less than $3K. In the end, they settled and dismissed the case. I believe that their attorney's fees were part of the settlement. I don't know where you live, but in civil cases where I am, in WI, the loser often has to pay the winner's attorney's fees.

JK

[trader4]

Settling out of court is a bit different than going to trial. You said it spent 18 months in court, which I took to mean it was resolved in court with an actual verdict.

Those fees are pretty modest. It's not a skyscraper, but expert testimony for court action doesn't come cheap. $700 sounds about right for a simple written report. But if it had not been settled, the expert has to spend hours to get deposed, hours to attend court for a morning to testify, including things like travel time, it would be a lot higher. And the legal fees for an actual trial are going to be a lot higher as well.

Keep in mind the award of legal fees in a case like this, even in states where it happens, is a very double edged sword. If you LOSE, you pay their costs, which, depending on who you're fighting, like a big insurance company for example, could be huge. Which is one reason many states don't have this policy.

So, spending $3700 more to try recover $15K, doesn't necessarily sound like a great idea to me. I guess if you really believe you have a slam dunk case, it could make sense. Personally, depending on the limit for small claims, I think I'd go there and receive maybe a max of $5k if you win, without the expenses if you lose.

[tmurf.1]

Your attorney can do it