Buyer Rebate Questions
What is a “Buyer Rebate”?:
A buyer rebate is where your buyers agent gives back to you or “Rebates” part of their commission at closing when you buy a property using them
Why would a buyer’s agent “Rebate” part of their commission to a buyer?:
It’s an incentive for a buyer to do business with that buyer’s agent. The result is more business for that buyer’s agent and you, the buyer earing cash back at closing to buy a home. The perfect combination!
Are Home Buyer Rebates legal?:
Yes. In 40 states, see: Article from The Department of Justice.
How do I verify I’m going to get my rebate?: This is VERY IMPORTANT! Your very first contact must be with us as your buyer’s agent. You CANNOT contact the listing agent on a home you are interested in! If you see a home and then contact the listing agent for information you immediately become that listing agent’s prospective buyer. That listing agent will have establshed you as their buyer prospect. So, it is critical that you contact us as your agent first and tell us the property you are interested in. We will then contact the listing agent as YOUR BUYER’S AGENT.
What if I am working with another home buyer’s agent?: You can always email / call that buyer’s agent back and tell them you’ve gone in another direction. Remember, you can use who you wish to buy a home.
How does the process work?: The mechanics. You’re searching for a home and find some homes you’re interested in. You would contact us as your buyer’s agent and email the list of homes you’re interested in. We would then contact the listing agent and help schedule the showings. When you wish to make the offer we would draw up the offer, get it to you. You sign the offer then we get it to the listing agent and begin the negotiating process. When we come to terms then we are there to help you from start to finish just like a regular Realtor. You lose nothing using compared to any other buyer’s agent. We are here to provide full Realtor services to you through closing!
More important points to remember:
- Per recent lending laws in order to have the “Home Buyer Rebate” on the closing statement so you get paid the buyer rebate MUST be on the original offer to purchase. VERY important. If the rebate language is not on the offer to purchase when we are negotiating with the listing agent you may not get your rebate. Your lender needs to be aware of this rebate and will require the buyer rebate to be ON THE OFFER TO PURCHASE.
- Procuring cause: KNOW THIS! Procuring cause is the “Series of events that lead to the successful purchase of a home”. In plain English it gets down to who deserves the commission on a deal. If you as a buyer contact a listing agent you could become their buyer. Even if you end up buying through us or another agent, that original listing agent could argue you are their buyer because you established contact with them first on the home being purchase. Google “procuring cause” for detailed information.