In my varied life as a business-person, I have had partners from time to time. The form of business might vary – sole proprietorship, limited partnership, even corporation – but in our guts we knew what we were: partners.
As partners we had a division of labor: I’d do things I was good at and my partner(s) would focus on areas in which they had expertise. And, as partners, we shared expenses and split profits.
My own partnerships were pretty simple and the split was usually equal among the parties. Working with other businesses, however, I’ve often seen splits that were weighted one way or another 60/40 or 51/49 and so on.
Has it ever occurred to you that when you hire an ordinary real estate agent, you are taking them on as a partner in your property? Really: if you are agreeing to split with the agent on a 94/6 basis, you’re taking them on as a partner in your property. Maybe you’ve been in it, improving it, investing in it for five years. This agent is coming in during the final 3 or 4 months of your ownership, and somehow is entitled to 6%* of what you’ve built!
And here’s the big kicker: we’re not talking about splitting your profit 94/6 with the agent. You’re going to pay them 6%* of the gross! Of the Sale Price.
Let’s assume the house sells for $400,000 and that you have a $300,000 mortgage that must be paid off at closing. The agent’s 6%* commission is $24,000. Ouch! That’s 6%* of the Sale Price. But after you pay off your mortgage, you won’t have $400,000, you’ll only have $100,000 and it’s from that that you must pay the agent. That $24,000 commission is almost 25% of your proceeds, your net!
Are you really going to give away 25% of your net to an agent who will put the property on the Internet, fill in the blanks of the contract, manage the inspections and keep things moving to closing? Really??
I’m not. No way. There is not that much value in the relationship. Don’t get me wrong: Realtors are incredibly valuable in the equation, but 25% of your net valuable? Hardly. I”m going to pay a Set Fee to sell my house. You know a Set Fee, like what my dentist charges to fill a tooth, like my doctor charges for an office visit, like my mechanic charges for an oil change. I’m going to pay a flat $5,550* to sell my $400,000 house – the same $5,550 my neighbor with the $350,000 house will pay. And for that, I’m going to get full service, great marketing, agent representation and hand holding every step of the way. I’ll be saving almost $20,000 over what that ordinary agent was going to charge me!
So how about you? Do you want to save thousands? Are you tired of having a new partner swoop in at the 11th hour of your home ownership to claim a big chunk of your equity? If so, here’s what you do:
Click the link up there in the top right of this page where it says ‘Find a Help-U-Sell Office.’ You’ll be glad you did!
*Real estate commissions, whether percentage based or set fee, are always negotiable between the consumer and the broker. They are not set by law or Realtor rule and there is no ‘going rate.’ The $5,550 I used to illustrate a Help-U-Sell set fee is just an example. Help-U-Sell fees vary by office because different marketplaces behave differently and require more or less effort and marketing expense. Having said that, there is one great truth here: you will almost always save big on real estate commissions when you work with Help-U-Sell. Savings is what we are all about!
