Real Estate license to rebate own home?

ArroyoLn1

New member
Hi TI! My first post so bare with me!

The wife and I were thinking of purchasing our first new constructed home in the next year or so and we were wondering if we could be our own agent and receive "commission" from the builder?

Has anyone had any experience with this?
 
Depends on builder, some yes, some no. Some won't even let you rebate to family members. 
 
If you are financing a property, most lenders will require the builders referral fee to be used either for closing costs only (the only example of an allowed direct payment to you) or paid to your Broker of Record. If you're the Broker, and financing the home, the referral fee is not always eligible to be paid to you.

The path of least resistance is often to bring a Realtor with you like USCTrojanCPA, IrvineRealtor, or others who have 1st hand knowledge of each builders processes and procedures. Yes, it might mean a lower net to you, but that IMHO is the price of convenience and experience. I know the wheel has been invented, so why should I go through the trouble to re-invent one?

My .02c

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I self-represented on a purchase from Irvine Pacific. I've also represented family. I didn't see any rules that prevented self-representation or family representation on the agent/broker agreement. I always rebate out outside of escrow - so not sure if trying to rebate through commission is where these rules/restrictions come into play.
 
ArroyoLn1 said:
Thanks! Was there a "list"?

Not sure what a "list" is. There is a broker co-op agreement that you sign as the agent when the purchase agreement is executed. If you want to self-present, you can call and ask if they allow. If they say no, you can say - so can I bring another agent? You want to know your facts before your first visit.
 
There isn't a list like that, it's builder specific (and builder policies change periodically).  Some builders won't allow you to represent yourself while most will.  That being said, most builders that allow you to represent yourself will not allow you to credit yourself the broker co-op towards closing costs but some will.  However, if you are getting a loan the lender will not allow you to credit yourself towards closing costs.  So if you do represent yourself, you will most likely be forced to take the broker co-op commission as income on a new home purchase.  This is what happened when I purchased my resale homes, the listing agents told me BS that their clients weren't comfortable reducing the sales price by my commission so I was forced to take the buyer agent commission as income.
 
Best bet is to call ahead and find out what the deal is. This way, you won't get burned by the "first visit" rule.

As USC mentioned, the co-op/commission is likely going to be treated as income. If you're not already licensed and do not have expenses - it may make sense to bring an outside agent who can offer a generous split. The rebate you receive after closing generally won't come with a 1099.
 
best_potsticker_in_town said:
Best bet is to call ahead and find out what the deal is. This way, you won't get burned by the "first visit" rule.

As USC mentioned, the co-op/commission is likely going to be treated as income. If you're not already licensed and do not have expenses - it may make sense to bring an outside agent who can offer a generous split. The rebate you receive after closing generally won't come with a 1099.

+1...you can call and email the sales offices but your first physical visit needs to be with a realtor (if they won't allow you to represent yourself).  Most builders are very strict with that first physical visit rule...especially Irvine Pacific, New Home Company, and Shea Homes.
 
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