NOTICE: READ THIS INSTRUCTIONS CAREFULLY BEFORE FILLING OUT THE REQUEST! This Form is REQUIRED for Rebate | Referral Fee | Commission Reduction
Why I need approval? Per Texas Occupation Code (the ACT) which governs your licensing rules, Brokerage Fees belong to the Broker and not the Associate. Associates may not receive any fees except from their sponsoring broker. In accordance to the above law and pursuant to your ICA, you agreed that first and foremost, ALL brokerage fees, including but not limited to commissions, bonuses and referral fees belong to Broker and considered Broker’s property, regardless of who procured the client. For more information see your Office Policy Manual.
Furthermore, the scope of authority given to you to represent your Broker on each transaction does not provide you with the authority to negotiate a commission on behalf of your Broker. It specifically says: Sales Associate shall not compromise, reduce and/or forgo any “Brokerage Fees” without the written approval from Broker.
When to use this Form to make a request? This form can be used to request Broker’s written approval for reducing brokerage fees that are not customary in our industry. Customary Fees are:
1- When Seller is the client: Listing Agreements are signed with 6% commission – 3% to Seller’s Agent and 3% to Buyer’s agent
2- When Buyer is the client: Buyer’s agent commissions are 3% or greater when bonus is offered
If you wish to reduce the brokerage fees that are less than what described above, you must get your broker’s written approval by completing this form first and obtaining approval.
This form is also required to Rebate clients or Referral fee to another license holder since it will reduce the Brokerage Fees.
This form by itself doesn’t constitute an approval. Your request will be first reviewed by our compliance team and upon their recommendation your broker may accept or reject your request.
Are there any Fees? In most cases there are nominal fees to process your application and receiving an approval
IMPORTANT NOTE: for simplicity we call request for reductions in commission (such as Rebate, Referral, Commission Reduction, etc..) as “Rebate”:
Fees when application is approved
1- $39 Application Fee – Amount will be subtracted at closing
2- Broker processing Fee: Additional Transaction Fee OR 10% of Rebate when the rebate amount exceeds 50% of the Gross Commission. See two examples below:
If you are on our Plus Plan and your Transaction Fee is $385 per Transaction, Broker Processing Fee will be one of the following depending on the % rebate, referral or commission reduction that is requested:
|Sales Price||Customary Commission||Gross Commission||Rebate Amount||Rebate %||Broker Processing Fee|
|$300,000||3%||$9,000||$2,000||22% (less than 50%)||$385|
|$300,000||3%||$,9000||$8,000||88% (greater than 50%)||$800|