Broker's fee for unlisted boat

I don't understand why anyone would pay a dime if the person was the "other guy's" broker. If a seller is retaining a broker as a buuyer's broker, the buyer pays the commission, plain and simple. If I contract with a broker to sell my boat his commission is MY responsibility, not the buyers - the buyer never sees that transaction. In this case the broker appears to representing himself as a buyer's broker. His job, therefore, is to get the best price for his client and the client pays based on the selling price. Bottom line, unless you have a written contract where this person is acting as YOUR SELLING BROKER you are under no obligation to pay him anything. That you would want to pay him something to "feel good" makes no sense to me. Put it this way, if you were selling your house yourself would you pay a real estate agent/broker his customary comission if he had a buyer (or was the buyer)? No, that's between him and his client. It would be extortion for him to expect you to pay him any commission. The ONLY way he could expect any payment is if he was working for YOU (or you have a broker and the property is listed with an MLS, in which case they split the commission).
 
I think there is some confusion here as to the terms Broker, Buyers Broker, Sellers Broker.
First a "Broker" is an intermediary, who negoitates the sale. It is not his call as to the sale price, that is the sellers job, it is the brokers job to handle negotiations without prejudice.
As a broker of ag products, myself, I don't understand the terms Buyers and Sellers brokers, what you are describing are paid sales or buying agents. There is nothing unique about the seller paying the commission, this is and always has been the norm.
AS for the seller paying the brokerage, so what. If the broker can't sell it high enough, turn down the bid. If from the buyers side, he thinks it is too high, turn down the offer. The benefit of the broker should be his negotiating skills to bring the two parties to an agreement and make both parties satisfied with the trade.If you have a problem with the guy's honesty and integrity, don't use him. But if you do decide to retain him remember, he isn't God and can't do miracles, he's just a salesman with, hopefully, skills and knowledge you need and can use to your benefit. Good Luck.
 
if you want to sell your boat talk to the man and see what he expects. if you dont want to sell your boat then tell him you wont pay him.
 
quote:
Originally posted by Dauntless

Bottom line, unless you have a written contract where this person is acting as YOUR SELLING BROKER you are under no obligation to pay him anything.

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I agree that I am under no obligation; but he is under no obligation to give me the name of his potential buyer either. So if I want to have the opportunity to sell the boat to the potential buyer the broker found, I expect he will want some sort of commission if the deal goes through, certainly less than the usual 10% but something greater than 0. Part of the problem here is that I am not interested in having this broker be my contracted listing broker. This would be a one shot deal.

I agree that if I list the boat myself on boat trader or boats.com I may just snag this same interested buyer, and that is what I will try to do if I can't work out a satisfactory agreement with the broker in question.
 
By all means go talk to the man. Lay it out like you want it done, if he don't want the deal, shake hands & walk away.
 
See, people named Harlan, no matter how you spell it, are the voice of reason. :)
 
"I agree that I am under no obligation; but he is under no obligation to give me the name of his potential buyer either. So if I want to have the opportunity to sell the boat to the potential buyer the broker found, I expect he will want some sort of commission if the deal goes through, certainly less than the usual 10% but something greater than 0."

True, you are under no obligation and, true, he is under no obligation to give you the name of the buyer. In fact, he never has to. All you "see" is someone who is willing to pay you some amount of money for your boat, whether as a private individual or through a broker for that individual. It is possible that you may never know who the buyer is (do you care?). You already have the opportunity to sell the boat - you own it! The only person taking action here is the potential buyer in the way of contracting with someone who is going to go find a boat that meets your requirements. The fee for that service is between the buyer and the broker. If you want a more active sales approach than what you can accomplish on your own then YOU hire a SELLING broker and you pay him his agrred-to commission from your proceeds. If the buyer is using a broker, too, the two brokers split the fee. To take this one step further, let's say you BOTH have a broker. Do you pay YOUR broker AND the BUYER'S broker's commission? No, you ONLY pay what you agreed to with your broker and the buyer what he agreed to with his broker - again, the normal way this is done is by splitting the commission that the seller's broker gets - that's how real-estate works, that's how boats work (or should work). It is less common to have a buyer's broker, though. So, the way the contract would be written is . . . "I find you a boat. If it is an MLS boat, I do the customary commission split. If I find an unbrokered boat you pay me X dollars or X% of the purchase price (or whatever you agree to, to include a date with your gap-toothed sister and one hog . . .)"

Let's put it another way. Let's say I have a concierge service that has someone go out and buy my groceries. If the concierge goes to the grocery store and buys some onions is the grocery store supposed to pay the concierge some commission for buying THEIR onions? No, if that happend I would expect the concierge's name to be Toni "The Chin" Cinzenzo and the FBI would be going after him under RICO.

Bottom line, the broker who has a buyer is working for the buyer. The buyer is responsible for his care and feeding. He has NO responsiblity to you. You are only responsible for handing over the boat when the check clears the bank. If you agree that you owe the broker something - with whom you have no agreement to sell your boat - you are corrupting the process - and that would explain the stupid price of things in the world of boating. And, it would be illegal, if not at least unethical, for the broker to accpet - or demand - payment from both parties. That's called conflict of interest.
 
For crissake, call the guy or give me his number, I'll call and ask.
 
If the boats for sale you will work something out that suits all parties envolved. the broker is entitled to somthing. His family has to eat! sounds like some here just dont see the value of the brokers efforts, It may seem like a lot of money for not alot of time, but "who Cares" tou want the boat Gone right? so call the guy let him know what you need out of the deal and get it done. I'm sure the broker has done this before and you will either agree on terms or not. Beating it to death here doesnt sell the boat.....
 
That the broker needs to eat isn't the point. That it appears he is working for the buyer is. Why are some of you treating a sale/purchase of a boat any differently than any other financial transaction?

Here's another example: You plant a "For Sale By Owner" sign on your lot. Somebody comes by and says, "I have this guy that wants your lot." You say, "Great, make me an offer." You accept the offer. Do you now pay that guy a commission? No, the buyer does - on top of what he paid you for the lot. You didn't contract with him to sell your lot, you were doing it yourself. He just happened to have a client who was looking for a lot and yours fit the bill. If the other guy's agent demands payment from you he is in violation of the law - that's called extortion. If you had sold it to someone else in a private sale, no agents involved, neither of you would have paid anyone any commission. By the previous logic, should you "pay" the buyer a commission for buying your lot?

The ONLY time you pay someone a commission is if you have contracted with them to be your agent. No contract, no payment. As a "For Sale By Owner" you have to look at ANYONE who offers or presents an offer to purchase as a private sale - you should be blind to the realtionship between the parties making the purchase. You are merely exchanging property for cash that you undertook to sell on your own accord without an agent.

And let's not forget, the broker ONLY works for the party contracted to pay him. In this case it is a seller.
 
Dauntless, I follow your logic and from a principal and theory standpoint you are dead on. But if he wants to sell the boat throw all that crap out the window. The buyer has a limit to what he is willing to pay and the seller a limit as to what he'll accept. he can stand firm on principle and own the boat! or as Monty Hall used to say " Lets Make A Deal"
 
Dauntless,

I work in real estate. I have never seen a buyer pay a commision on a For Sale By Owner property. It is also rare to see a seller refuse to pay a commision to a buyer's broker when the buyer's broker brings the buyer to you, the seller. This is not extorsion. Extorsion is if I say "BIg Tony" will be by to collect "fire Insurance" money. Pay up, or else. This is a business transaction. "I have a buyer interested in your home. Are you willing (willing, not forced) to pay me a finders fee or X% commision to bring you this buyer?" If they agree, a short written agreement is executed. There is no forced acceptance.

We do this because the buyer does not expect to pay any commision to buyer's brokers. In real estate, most buyer's brokers get paid by a Co-op fee from the listing side. In the MLS, it will say that the listing broker is offering a X% buyer's brokers co-op fee. This gets paid by the listing side, even though the buyer's broker still represents the interests of the buyer. This is legal in every state, as far as I know. There is no extorsion. The seller is not forced to offer a co-op fee. But, I'm not sure how many buyers will be broguht by that house when the buyer's agent would be working for no pay. There is no law that requires us to work free of charge.

In the real estate industry, "For Sale By owner" properties are also known informally as "Unrepresented sellers". Sort of like being your own lawyer in court. Once in a while, it works out for them, but on average, a For Sale By Owner property sells for 16% less than an equivalent home that is marketed and sold professionally.

Some background on why the listing broker's fee and the buyer's broker fee are usually both paid by the seller. The logic here is that the selller often has some built up equity, and can "afford" to pay both sides of the commision. Whereas, the buyers are often first time homebuyers and are already scraping every penny for a down payment, and having to pay a buyer's broker commision on top of that would break the deal. I'm not saying it's "fair". But, it is legal in most, if not all, states. The legislatures are probably trying to spur more home ownership, and that would be harder if the buyer's had to come up with an additional $XXXX in commision on top of the down payment and closing costs.

Hope this clears up some stuff.
 
OK, yes, if you want to sell at whatever you agree to sell at, at whatever terms you want, you can pay anyone anything you want, including the Maitre d' of your favorite restaurant.

However, one has no obligation to pay anyone for whom they didn't contract to perform a service. Nor should one fell obligated. If someone comes to me and says they have a client that wants to buy whatever I have to sell I will say "that's nice, bring me a check." I expect the purchaser to pay their agent a finder's fee (call it a commission if you wish). I do not pay the other guy's agent's finder's fee. The purchaser hired the agent to do their leg work. Now, if I ask someone to do my leg work, I expect I will pay for that (and I will figure that cost into my selling price to some degree).

Now, as for selling a house, if I am the owner/agent, I do not pay a commission. That was the whole point of selling it myself in the first place, wasn't it? Whether I do better or worse than using an agent is irrelevent - that's merely a function of my marketing and negotiating skills. ONLY IF ONE USES AN AGENT DOES ONE PAY A COMMISSION because that would have been in the listing contract. Then, again, how likely is an agent going to present a property that is for sale by owner? If it isn't in the MLS it "doesn't exist." Now, an agent might try to persuade an owner that he'd get better results if he used the agent's services, but then you are entering into a conventional real estate transaction. We're talking the same thing here but with a boat.

Bottom line, if an agent for a buyer approaches the seller, the seller needs to realize that the agent is working in the best interest of their client, the buyer, not the seller. And, in reality, who pays the commission is irrelevent - it can be put on either side of the spread sheet. And, in reality (if not outlined on paper), it IS the buyer who "pays" the commission - that's the function of the down-payment.
 
Dauntless,
I don't disagree with you _in thoery_. I was just trying to present to you how it works in real estate _in reality_ of how it works. You are correct that For Sale By Owner properties (FSBO) properties are often "invisible" (hence they get less potential qualified buyers and less price). But, there are times a buyer comes across one (drive-by, etc.) and is interested in it. You can belieive me or not here (I'm not sure how much real estate sales or brokerage experience you have), but the reality is I have never seen the buyer pay the commission on a FSBO. Theory is one thing; reality is another. As for boat brokers, I have no idea what the standard of practice is. It might be that the seller never pays a buyer's agent. I dunno.
 
Dauntless...you don't do many deals do you??? How do you think Google works??? I bring you a potential buyer you pay. What this guy is suggesting is only pay for performance.
 
But I would essentially be contracting to bring me a buyer (actually, not really, it would be a mere advertising situation). Just like eBay. I pay them a commission on the amount of the sale price. What I am paying for is their listing service, their market exposure. If I sell the item outside of that environment (like a neighbor sees I have a thing I'm trying to sell and offers to buy it even if it's listed somewhere) I don't pay eBay a commission, do I? Unless I have an exclusivity contract - like I do with my selling broker for my boat - I don't owe anyone a dime if I sell it myself outside of that environment.

Yeah, I do plenty of deals. The point that seems to be missed, here, is that you don't owe anyone anything for any service for which you did not contract. "Hey, I told my buddy I saw your car for sale and he will be right over to buy it . . . oh, and you owe me 5% for making that happen." Uh, no, I don't think so. How would this boat scenario be any different? Just because the guy is a broker? What if, in the example above, the fellow whose buddy is coming over to buy the car is a car broker? That's nice, I still have zero financial obligation to him. If things worked that way I'd owe the person at Costco hawking the sausages a commission if I decide I want to buy a pack or two.

Here's a better example. A car broker friend takes me along to a car auction. We agree that I will pay him $200 for his service of bidding on the car I want. Does the seller of the car now owe my broker friend for that transaction? I can tell you without question - - NO! Been there, done that, got a good deal. Now, the seller owes the AUCTION company something for use of their venue (which could be a fixed fee or percentage), but that has nothing to do with my transaction.

And, as for you, Glen, I suggest the Beef on a Weck at Jimmy's.
 
Lots of baloney here.
Sellers always pay commission, not because they have equity or other bs but just because they are the seller and it is customary or maybe that is where the money is, it really doesn’t matter much. The only exception is auction where the buyer pays fee to the auctioneer, always, because that is how it works. There is no logical justification for any of this its just is how things work.
BUT there is a higher rule than what is customary and that is that is everything , everything is negotiable.
The problem despite all the opinions here is that you can’t negotiate with anyone unless they are identified and want to buy. A broker that brings a buyer is doing his job and will protect the ID of that buyer until he has a contract that guarantees his payment, to do anything else would be stupid. The amount he will be paid is always negotiable and renegotiable at every step until closing.
I repeat if you want to sell the boat talk to the broker without preconditions and see what he has to say. Then establish your conditions and negotiate. You will have a better negotiating position with a single person broker salesman that with a multi party company.
 
With so many boats and much fewer buyers, let the broker bring on the buyer and pay him 5%. The value is in the qualified buyer now, boats have been sitting for for much longer periods of time in this market awaiting buyers.
 
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