Letters to the Editor

Re: 'Debate rises over MLS role in offer of compensation' (Aug. 23)

Dear Editor:

Regarding buyer agent compensation: if the system is changed from the current position of the seller paying the entire commission, I was wondering what the proposal was for financing the buyer agent's commission? On a $650,000 (average in our market) sale, this would be something like $19,500 at 3 percent, or more often now in our softer market something like $26,000 at 4 percent.

Right now with the commission costs included in the sales price, the mortgage provides the bulk of the funds.

If there was a buyer-paid fee, this would not be included in the mortgage under today's transaction norms. Basically under the proposed change the buyer would have to come up with something on the order of 3 percent or 4 percent of the sales price as additional "cash out of pocket." This of course would take more buyers out of the market as their liquidity is already pushed to the limit.

I have a hard time seeing any advantage of changing the buyer agent's compensation part of the system. "If it ain't broke, don't fix it."

Don Murray
California First Financial

All rights reserved. This article may not be used or reproduced in any manner whatsoever, in part or in whole, without written permission of Inman News. Use of this article without permission is a violation of federal copyright law.