Comments on: $395 Realty Firm's "Admin Fee": Junk or Legit? (Update: Now called “Additional Commission”)

By: FranklyRealty.com

FranklyRealty.com — Fri, 13 Jan 2012 02:00:00 +0000

(this is NOT legal advice)

I doubt the FLA agent said it is required by law. Ask for her and her broker to put that in writing. Perhaps she is referring to laws that require you to perform as per a contract you have signed.

The fee is bogus, and there have been class action suits on this topic. The new way around it is the firm charging a 2nd commission, or a higher total commission and not calling it Admin Fee since that might be a RESPA violation.

B. in Midwest, for them to say that all companies charge that fee, is also bogus. Get them to put that in writing. Do it by emailing them, “as per our conversation, I signed this document based on your statement that all companies charge this fee, you still stand by that right.” If they reply, then show the broker and ask if they agree with this statement. They will not and you might be able to claim you signed based on incorrect information.

B. if you haven’t signed yet… get another agent.

Frank

By: B. in Midwest

B. in Midwest — Thu, 12 Jan 2012 18:32:22 +0000

I’d like to chime in regarding what Steve posted above. I’m a first-time buyer and was told by my prospective agent that the only way I’d see any properties is to sign an agreement and that all agencies share similar fees. This was also a Keller Williams office.

Now I’m subject to a $395 fee to make an offer PLUS $250 “administrative fees” at closing and the buyer’s agent will make commission on top of that. I questioned what the $395 was for, and the agent said it was split between himself, his group, and KW. No explanation of what the fee was for, just who it goes to.

Also seeking suggestions, though I’m corroborating Steve’s story too.

By: steve musich

steve musich — Thu, 12 Jan 2012 16:55:24 +0000

A re agent in florida is telling me I must pay a “keller williams administration fee” or she won’t close the deal, plus take it off the market. It’s a short sale. I haven’t contacted her yet. she said re law requires it. I think it’s looking for more money, but I would not like to lose this deal. suggestions? steve.

By: Michelle

Michelle — Fri, 08 Jul 2011 18:31:47 +0000

Thank you! Between my husband me and me, we have three home purchases and never had been charged an admin fee. Now, here we are, looking at a $195 fee. Our agent was pretty quick to say that she would take care of it when we complained. I feel sorry for anyone who is using an agent that takes days to eat that fee! Switch, fast! Having to deal with this fee is discouraging when considering whether we will use this agent in the future

By: Jay

Jay — Thu, 26 May 2011 23:27:53 +0000

Thanks for this you just saved me $295.

By: Yury

Yury — Tue, 15 Mar 2011 14:24:47 +0000

Frank – we saved $425 (admin fee) by following your advise. When we first met an agent, she had us signed the $425 admin fee disclosure (Keller Williams agency in MD). We reluctantly signed it (agent advised that every broker in the state has implemented the fee to cover admin expenses) but looked it up online later that day. Thanks to your blog, I found out that it’s just another junk fee that’s being passed on to the client. I fought back and the agent eliminated the fee (after 3 days worth of exchanging emails). Thanks for educating!!!

By: Metrohunt

Metrohunt — Thu, 10 Mar 2011 20:32:18 +0000

Great blog post on this topic!

BTW, I just paid a $375 admin fee to Long and Foster (didn’t they invent this junk fee) as a buyer of a Fannie Mae HomePath foreclosure. Note that this agent and the listing agent worked in the same office and this was the only property my agent showed me (after I found it).

News flash – The title company that did the settlement refunded this amount to me a month later after the closing since apparently this fee is NOT allowed for Fannie foreclosure sales.

By: HomeList

HomeList — Tue, 22 Feb 2011 18:47:27 +0000

Excellent post!

I think it’s getting absurd, especially when they do these fees for buyers now too! I’ve seen them as high as $500! I think it’s really just people in the industry trying to take advantage of unsuspecting customers who get overwhelmed by the entire process, but specifically the HUD statement with all its fees that usually aren’t explained very well.

By: Realtor Commissions. The Great Hush Hush Exposed. | FranklyRealty.com Trust Me I'm A REALTOR

Mon, 21 Feb 2011 14:41:58 +0000

[...] amount covers the new trend toward charging what I consider bogus “Admin Fees.” (See my Admin Fee post and Ken Harney’s article. Or watch my [...]

By: Jim Goff

Jim Goff — Mon, 26 Jul 2010 17:55:37 +0000

First pff any Real Estate Company has to generate enough mony to pay the bills.

I have a rather large problem with the Admin Fee or what ever my company is calling it. I think it is referred to as a fee. Ok a good example I have is the lowest priced home I hae ever represented was one for $50,000 and my company want a $345 admine fee – I did not charge it and when myu company processes the paper work they just deduct it from money due me. My biggest sale was a property for $2,230,000 and it had an Admin fee I think in those days it was $195 but I did not charge it and that amount was taken out of my check. Every since my company teld me that they were having trouble with admin fee and I looked at the chatter on the Net I felt I could no longer charge that fee. As puttng lipstick on the pig does not change it from being a pig. f it is a fee they we should get a split of that fee just like we do on co-op fee and or listing fee. Bottom
the eyes of our clients get a little wide open when we talk about that fee and really the level of trust goes down.

Jim