BrokerageIndustry News

‘Junk’ fee or necessity?

Part I: Broker fees divide industry

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Editor's note: With more brokerages charging consumers flat fees on top of their traditional percentage-based commissions, Inman News explores the legal, ethical and competitive issues involved. Part I explores the industry's rationale for instituting the fees, and the reaction of agents. Part II will examine potential legal liability under the federal Real Estate Settlement Procedures Act (RESPA), and Part III looks at the online backlash from consumers and real estate professionals.In what's become standard practice at a growing number of real estate brokerages, homebuyers and sellers are being asked to pay flat fees of several hundred dollars per transaction on top of the percentage-based commissions they've traditionally been assessed.The fees can come as an unpleasant surprise to consumers, and some have charged that they violate federal law. Many real estate agents don't like the flat fees, either -- in most cases, they don't receive a cut, and some end up paying them out of thei...