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Irwin Law
Irwin Law, Lawyer
Category: Real Estate Law
Satisfied Customers: 7416
Experience:  Lawyer- Broker 30+years - foreclosure, short sale, liens, title attorney.
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Second opinion] is it illegal to agree on a buyer-broker fee

Customer Question

Second opinion] is it illegal to agree on a buyer-broker fee when the buyer has single handedly found the property that he or she wants without the broker discovering the property, however the broker obv brokered the purchasing agreement?JA: What's the contract for? Who are the parties?Customer: its for a housing purchase buyer(us), buyer broker (our guy), seller and seller's brokerJA: Where is the property located?Customer: californiaJA: Anything else you want the lawyer to know before I connect you?Customer: that we found the property online, visualized it and then sent our realtor who has not disclosed yet what is fee will be, we broached the subject of a finder/referral fee for us to assist with closing costs, but he states it is "illegal" i dont believe himJA: It can cost anywhere from $10 to $100, depending on the type of issue and how much of the Real Estate Lawyer's time your question is expected to take (how complex and lengthy an answer you require).Customer: I require a one line answer of is this legal and are we entitled to a finders fee?
Submitted: 2 months ago.
Category: Real Estate Law
Customer: replied 2 months ago.
We are the buyers and we found the property on our own. We told our realtor to broker the deal, and now we have an offer that was just accepted. We just casually asked our realtor about our finder's fee to help offset closing costs etc and he is avoiding us.
Expert:  Irwin Law replied 2 months ago.

The buyer broker fee is governed by the same law as a seller broker fee. That is, it must be in writing and signed by both parties. The contract must specifically state the conditions on which the buyer of the home becomes liable to pay a commission or find your fee to the broker, and what the percentage is. The court will enforce the terms of the contract Since I have not read your contract, I cannot tell you whether you would win or lose in court, or how much you might be liable

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Customer: replied 2 months ago.
I am specifically asking about my broker paying part of his commission out to us or in other formats as a goodwill, since we found the property. Essentially he did no leg work and only brokered the deal.
Expert:  Irwin Law replied 2 months ago.

It's illegal for a licensed real estate broker to share a commission with a non licensed customer. Your broker most likely plans to attend the closing and receive his full commission, which is 50% of the full fee. Sorry, but there is nothing you can do about it. Perhaps your broker might buy you a nice house warming gift.