Is it illegal for an agent to lower a commission?

I was given an offer for 75K lower than asking. In order to lower the price as much as possible and cover my mortgage and agent fee, I asked the agent if she would lower her commission by 1%. She tells me it would be illegal to do this. Is it?

Asked on August 20, 2011 New York

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

From what you have written where you appear to be the interested buyer of a piece of property and your real estate agent is the selling agent in the transaction, I see no reason why the agent cannot agree to lower her real estate commission on the transaction by the requested reduction and have the seller's agent credit the amount of the reduction to you in the final closing papers UNLESS you have a federally funded loan.

If you have a federally funded loan to purchase the real property that you desire, your real estate agent would be correct that your request is illegal as a hidden fee in violation of federal RESPA laws. Under current RESPA laws resulting from the real estate debacle in this country still existing, hidden fees concerning a real estate transaction where there is a federally funded loan are illegal.

I suspect that your real estate agent is correct in what she told you about the commission request by you.


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