Watch for “Administrative Fees”

September 16th, 2009

Welcome back to my blog, for those of you following along I have not written in a few weeks but now summer has ended and I am back!

In this post I will talk briefly about a topic that comes up frequently and that is the fees charged by real estate professionals ON TOP of the commission they earn from you as the client.

Often this fee is set unbeknownst to the consumer when you engage the services of a Realtor or broker. This fee is often buried in the contract so often you do not know you have even agreed to it. Read your documents carefully, contact me, and DON’T AGREE TO IT! If you do happen to agree to the charge it will reappear at your closing on the HUD-1 settlement sheet on page 2 in line 704 and is characterized as an Administrative Fee or a Broker Service Fee. Generally, the amount within the range of $175.00 to $375.00.

This fee is nothing more than that of a cover charge like you would see in a club for just walking in the door. I believe that it is a charge that has no value. Usually the “services” they are offering under the terms “Administrative Fee” or a “Broker Service Fee” are the same services that either must perform or should be performing on your behalf, to earn their already significant commission!

I sympathize with the professionals that their job is not easy during these difficult housing times but these additional fees are not the proper way to earn money.

Do your work and question them as to why if you are already paying a commission should you also be charged any additional fee for the services already expected. Bottom line… don’t pay any fees that have no value. Read your documents and contact me before you sign!

This entry was posted on Wednesday, September 16th, 2009 at 7:33 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.