commission on transfer, quit claim, foreclosure?

16 years ago

I'm reading through my listing agreement for the sale of my mom's home and notice some lingo that concerns me ... not that I don't want to pay commission where due, but it is possible that the home will be forced to foreclosure within 2 months of listing if not sold. There is also the possibility of quit claim. This is a guardianship case (my mother has been found incompetent) - I am the legal plenary guardian with no other living relatives. I do not anticipate assuming responsibility of the property (via quit claim, etc) but feel foreclosure is possible.

Wording that is of concern (and brokers fee is 6%): "Brokers fee is due in the folowing circumstances: (1) if any interest in the Property is transferred, whether by sale, lease, exchange, governmental action, bankruptcy or any other means of transfer, regardless of whether the buyer is secured by Broker, Seller or any other person. (2) If Seller refuses or fails to sign an offer at the price and terms stated in this Agrement, defaults on an executed sales contract or agrees with a buyer to cancel an executed sales contract. (3) If, within, 90 days after Termination Date ("Protection Period"), Seller transfers or contracts to transfer the Property or any interest in the Property to any prospects with whom Seller, Broker or any real estate licensee communicated regarding the Property prior to Termination Date."

The judge has denied the Petition to Sell. She is mandating a complete review of any sales offer received prior to allowing it to be sold. She is quite diffiuclt and I have a really good feeling that she will not allow for commission to be paid by seller (my mom, the Ward) if it is foreclosed or transfered.

What do you all think? Is it common to have such a condition in a listing agreement - and is this standard practice to collect commission under any kind of transfer? My RE says that there is a $0 cost to cancel the agreement (which is spelled out in the contract) and that he won't hold me accountable. But there is some wording in the cancellation as well that indicates the 6% is due if cancelled and then property is transfered within that 90 day Protection period... I dunno - I'm concerned.

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Comments (5)

rusty105
16 years ago
Just a couple of quick questions, as it was not clear from your original post.

1) it sounded like there is a signed contract with a broker, is this correct?
2) if there is, who signed it? if your mom did, the contract may be null and void due to your Mom being found incompetent.
3) if there is a signed contract, was it recently signed. I think most states has some sort of a law that permits a contract to be broken within a short number of days (3 maybe) that disallows any sort of penilities. Most cell phone conrtacts are like this, maybe it applies to all contracts.
4) Has the listing broker done anything yet to show the house?

Rusty
funkill
Original Author
16 years ago
No - no listing agreement has been signed ... I received the agreement Wednesday - for my signature as Guardian. But that little paragraph made me too concerned to sign it.

And yes, the RE told me that I can cancel the contract at any time without penalty. But, the contract has a note saying the 6% "is due if cancelled and then property is transfered within that 90 day Protection period." I read that to contradict what he told me .... I do trust his word, but this is a bigger deal since the court's are requiring their agreement also - and now my RE works for a new broker. I don't know if they would attempt to collect or not ....
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rusty105
16 years ago
If no agreement has been signed, I would think you should be ok. just don't sign anything without having a laywer, or the judge look at it. What I do not understand is that if you are the guiardian, why are the courts so involved in this sale?
berniek
16 years ago
"Wording that is of concern (and brokers fee is 6%): "Brokers fee is due in the folowing circumstances: (1) if any interest in the Property is transferred, whether by sale, lease, exchange, governmental action, bankruptcy or any other means of transfer, regardless of whether the buyer is secured by Broker, Seller or any other person."

In your circumstances this para. would concern me also, I would strike out some of it or better yet, seek the advice of an attorney.
funkill
Original Author
16 years ago
"...if you are the guiardian, why are the courts so involved in this sale?"

Oh - the Judge is VERY involved in every aspect! What a total PITA. Both of my attorneys have horror stories. It is enough grief that I'm considering surrendering guardianship. I haven't the time or money to re-submit every document multiple times so The Judge can gain some personal kudos for dismissing it numerous times.... who the hell knows what her beef is. She dismissed the Annual Accounting because one (of about 600) of the receipts for a $63.51 purchase from Walmart was not available. As if I made the purchase for my own. I have gained absolutely NOTHING from this responsibility! I considered trying to gain (by purchasing the home myself, remodeling and reselling) but I've since decided not. Time to reduce involvement/stress...

commission on transfer, quit claim, foreclosure?

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commission on transfer, quit claim, foreclosure?

Comments (5)

rusty105

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rusty105

berniek

funkillOriginal Author

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funkill
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