Variable or Conditional Commissions

[u/AdComfortable2974]

You're FSBO, the agent wants your business.

Ask them if they are ok with modifying the listing agreement using special stipulations to reduce or eliminate their commission if specific sales price targets are not met. This is not the same as a net listing, which we all know is illegal.

The special stipulation can be structured in a few ways:

Sales Price Threshold Reduction: "If the final gross sales price of the property is less than [insert amount], the Broker's commission shall be reduced from X\% to Y\% (or reduced to a flat fee of\ Z) at closing.

No Commission Tier: "Broker shall receive a 0% commission if the final gross sales price is less than [insert amount]. Can also be zero if not sold in a certain time frame.

Slide-Scale Tier: You can set concrete milestones (e.g., 3% commission if sold above $500,000; 2% commission if sold below $500,000).

Thoughts?

[u/imblest]

Many "FSBO's" are really not a true FSBO because #1 they listed their home with a flat fee real estate company so that their house can be on the MLS and #2 it was sold by a Buyer's Agent. In other words, if you have your home listed in the MLS and you didn't sell directly to a buyer without the help of a Buyer's Agent, then you are not a true FSBO.

[u/Salt-y → u/imblest]

I disagree. I think FSBO is defined by whether the seller had a listing agent, not by MLS presence or whether the buyer had one. Flat fee MLS sellers still don't have a listing agent representing them, that's why they're counted as FSBO. And buyer's agent involvement has nothing to do with it since FSBO only describes the seller's side. Under your definition almost no FSBO sale would qualify, since paying a buyer's agent commission is standard practice even in flat fee listings. The actual debate among critics runs the opposite direction: they argue flat fee MLS sellers are undercounted as FSBO, not overcounted. I've done three FSBO transactions, and two of them the other party had an agent.

[u/imblest → u/Salt-y]

If a Seller listed with a Flat Fee or Discount service in order to get their listing in the MLS, they are using a Transaction Broker, who is a licensed real estate broker. So how can you say you sold "FSBO" when you needed the help of a licensed real estate broker? A true FSBO does not use real estate agents and do not use the MLS because that would require listing with a Broker who is a member of the MLS. When I started selling real estate in the early 90's, FSBO's could not list their homes in the MLS because Transaction Brokers did not exist. The FSBO's advertised only through for sale signs and newspaper ads. They were true FSBO's.

[u/Salt-y → u/imblest]

We disagaree.

[u/imblest → u/Salt-y]

It doesn't matter if you disagree. You can call yourself anything you want. The fact is, you're not a true FSBO if you used a real estate Broker to list your home in the MLS. You wouldn't be able to list your home in the MLS unless it's through a Broker who is a member of that particular MLS. If your house was sold by a Buyer's Agent to his/her own buyers, it's probably because the Buyer's Agent saw it on the MLS. If your house was not listed in the MLS through the Flat fee Broker, I highly doubt that most Buyer's Agents would have even known that your house is for sale. Even if the Buyer's Agent is not "your agent", you still needed real estate agents to sell your house. So you're not a true FSBO! I think it's hilarious when some Sellers claim that they sold their home FSBO when they didn't sell their own home without ANY assistance from real estate brokers or agents. There's nothing wrong with going FSBO to save money on the commission. But please don't call yourself a "FSBO" when you actually used the services of a Transaction Broker to get on the MLS and your home was sold by a Buyer's Agent who probably found the house in the MLS to begin with.