Property Grunt

Wednesday, March 23, 2005

Rental SOL? Curbed Reader on the verge of screwing a broker

In a recent entry of Curbed a reader wrote about an unusual situation regarding a rental broker. The reader viewed an apartment twice and put in an application for the apartment which was accepted and negotiated a fee for 12%. According to the reader the broker never had the client sign anything requiring the fee and the broker sent him to the landlord's office and the broker was never present at the lease signing. Now the reader wants to know if he can get out of paying a fee.

Below was the Grunt's response which he sent in to curbed.

I wish I got emails like this.

This broker is an idiot in the way he conducted himself. However I suspect he has an ace up his sleeve which is an exclusive agreement with the owner stating that he will get paid regardless of how the apartment is rented. Which is probably the reason why he was so careless about the process and that should really piss off the owner since the broker obviously did not take control of the deal which is his job.

The reader has every legal right to withhold the fee since he did not sign anything. But this is where it gets sticky. What type of agreement did the broker sign with the owner if there is any? If it penalizes the owner it might be a bad way to start a relationship with the owner. However if there was an agreement contingent on the just the client paying for commission then it could become one word against another without any paper trail to provide evidence.

My best advice is for the reader to consult a lawyer if he or she wishes to stiff the broker because there are certain risks associated with screwing over a broker.

Remember, the reader signed and sent the lease back but has not received it and the lease is not valid unless both parties sign. If the broker is in cahoots with the landlord they could withhold the lease until another party comes in and tell the reader they found someone better. Remember, until he has received a signed lease from the landlord the reader is technically still in the application phase.

If this was an exclusive of a manager I guarantee from my own experience that the reader is going to have a war on his hands because managers will fight tooth and nail for their money and cut their nose to spite their face if they are not getting the full 15. I feel bad for that agent because he is going to get his ass handed to him by his manager.

From some of the details present in the entry I am thinking its possible that the agent was not a real estate agent at all being completely unfamiliar with the process because of the mistakes that were made. Even rookie agents knows better than to send a client alone to the landlord's office to do the application and lease signing.

Although I have been burned a couple of times on rental deals where clients have killed the applications or simply refused to sign the lease I am not too sympathetic to the plight of this particular agent because he assumed too much and did everything wrong.