Developers and master agents who refuse to pay your commissions due.

[nomad]

I think this will be a popular thread.

Its becoming an increasing problem in this trade for developers to refuse to pay commission due to agents on time or not at all.

Has this happened to you? what should we do about it? how can we avoid it?

As you all know this has a bad affect on any companies cash flow, some developers/ master agents are worse than others letting your due commissions earn them some nice interest in the bank.

The worst type will even close their company to avoid paying you any money out.

Let discuss how solve this bad problem affecting our industry.

 

[The Soup Dragon]

I'm not an agent*, but I do like to understand how everyone is numerated / operate to make money and limit risks. As an outsider's first guess isn't the key to have minimised your risks through your contract with the master agent / builder? I appreciate that if the development offers good value (to buyers) then the whip hand is with developers. (Choice you face may be to take contract they offer or walk away.) When this is the case it is tricky for you in that you either walk away or deem the reward of easy sales to outweigh the risk of non payment of commission.

*I'm not an agent, but have acted as an introducer for friends (personal and cyber) looking to make same investment as I have into a property fund.

 

[Ivelin]

ask for a penalty payment

Before you start offering their development or project you have to sign a contract that describes your business relationship. You can put there that they have to pay your commission lat's say within one month after the closing of the deal or something like that, if not you can ask for a forfait!

 

[nomad]

I'm not an agent*, but I do like to understand how everyone is numerated / operate to make money and limit risks. As an outsider's first guess isn't the key to have minimised your risks through your contract with the master agent / builder? I appreciate that if the development offers good value (to buyers) then the whip hand is with developers. (Choice you face may be to take contract they offer or walk away.) When this is the case it is tricky for you in that you either walk away or deem the reward of easy sales to outweigh the risk of non payment of commission.

*I'm not an agent, but have acted as an introducer for friends (personal and cyber) looking to make same investment as I have into a property fund.

Thanks Soup,

Yes the contract is always a good start, but when it comes to timescales for your commission payment the contract sometimes cleverly says thing like, commission is usually paid within 30 days
please not the word usually.

Even companies that have been going for several years like Barrisford & Bird get caught out, I recently read an article in which they complained that the where owed a several figure sum by some developers.

I also know many agents that are owed commission money from Superior Worldwide, I think this is the tip of the iceberg and many others agent are suffering the same
non payments.

If you agents are let us know so we can all help each other.

 

[Fizzypopp]

Master Agent

As a master agent or first agent to developers we also find that trust is not forthcoming from sub-agents. Try as we might to be honest and transparent to them it seems there are always people trying to get the better hand.

Very few 'really' want to share.

Paul

 

[awahee123]

The only way forward here is to make a contract through lawyers and for the developers or superagents to pay you your commission from the deposit they receive.

 

[Fizzypopp]

Contracts Contracts Contracts

The only way forward here is to make a contract through lawyers and for the developers or superagents to pay you your commission from the deposit they receive.

We only move forward with anyone on this basis. Developers are easier to spot who are not really wanting to work with you - those who think they can get free exposure without any returns - they stumble on paperwork. Sub-agents are harder. Our contracts drawn up by our lawyer means the intended co-operater has the realization that they are dealing with a business like operation. We would like a $ for every sub-agent that says they are honest. 20 years of being involved in property has taught us one thing. Not all is what it seems. We insist also that all paperwork is done with the developer and all monies go to the developer without us even touching it. Seen too many parasites walk away with clients money.

Paul

 

[awahee123]

Yes its all down to doing your homework really,unfortunately some people do not,its all a learning curve even for the professional.