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Real Estate Scam?

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Found this realtor on craigslist. He is promising 2% cashback on any house you buy and he pockets the other 1%.

Sounds kind of shady.. I guess I have doubts because I found him on craigslist. Don't most realtors have to give at least 20% of their revenue to a broker?

I am thinking maybe the scam is when I give him a check for the contract to put in he pockets it and disappears. How does one avoid that?
 
but how can they afford to give away 2% when they have to usually give 1/2% or 1/3% of that 3% commission they make to their broker?
 
A guy at work does that offers 2%. Basically he is a no frills RE Agent ( you find your own house pretty much take care of everything) and he shows it to you. you get 2% and he gets 1/2 % and his broker gets 1/2 %.

I'm sure this varies from state to state.

They afford to do this because

1/2% of 500K = $2.5K for less than 15 hours of work
 
Originally posted by: Aimster
but how can they afford to give away 2% when they have to usually give 1/2% or 1/3% of that 3% commission they make to their broker?
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is he under an affiliate like remax or coldwell?
 
Expect a 1099 from them if you actually close a deal with this person representing you.

Don't expect to get a good agent.
 
From what I have been told, at least in CA, that agent from each party (buyer and seller) gets 3%. So if you dont have an agent representing you, that 3% that your agent would be getting is up for grabs. You get 2% of it and he gets the other 1% along with the 3% he is getting for selling the house. Again, this is just what I have been told.
 
Originally posted by: zylander
From what I have been told, at least in CA, that agent from each party (buyer and seller) gets 3%. So if you dont have an agent representing you, that 3% that your agent would be getting is up for grabs. You get 2% of it and he gets the other 1% along with the 3% he is getting for selling the house. Again, this is just what I have been told.
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The seller specifies what the commissions will be. You list the buyer's agents commission on the property listing. And the selling agent can be paid whatever (our agent did a flat rate commission).

 
You in essence won't have a buyer's agent truly representing you. You'll be using the seller's agent. This would be ok IF you're pretty savvy about the inter-workings of a real estate transaction and come into the deal knowing that you are on your own. If I did this, I'd probably have a real estate attorney look over the closing papers.

 
Couldn't I just hire a real estate lawyer and get the full 3% myself and just pay the lawyer for his time at closing?
Sounds like a better option, no?
 
When I bought my house in Seattle, I used ZipRealty.com and got a 1% credit back after the sale. Got a check in the mail 30 days after closing.
 
Originally posted by: Aimster
Couldn't I just hire a real estate lawyer and get the full 3% myself and just pay the lawyer for his time at closing?
Sounds like a better option, no?
Click to expand...

you could but he needs a RE license
 
Originally posted by: zylander
From what I have been told, at least in CA, that agent from each party (buyer and seller) gets 3%. So if you dont have an agent representing you, that 3% that your agent would be getting is up for grabs. You get 2% of it and he gets the other 1% along with the 3% he is getting for selling the house. Again, this is just what I have been told.
Click to expand...

it's 3% to the LISTING agent and 3% to whomever handles the sale. If the listing and agent at the sale are the same then they get the whole 6%.

However, this is MAJORLY negotiable now. When I bought a house a couple years ago I only allowed for 3% to be paid total.
 
The agencys (listing and buying) split the commission. Then usually the agent splits it with their agency.

A 6% commission ends up being 1.5% to each agent.

Now if the agent owns the agency; that is where the standard 3% will come from.
 
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