How to Protect Your Interest as Real Estate Agent

Everyone can dream about earning big commissions as a real estate agent. Everyone, as in, EVERYONE. But the frequently asked question is, what if the buyer will bypass you as an agent and will go directly to the seller? How are you going to protect your claim of the commission? Here is a specific question and answer below.


Hi John, I came to know your website (REIBS.COM) after searching for a document that I can use. I am individual who has interest in selling hotel properties in Asia as I have the contacts to the buyer. My problem is I have no company nor am I a real estate agent. I came to know an investment and funding company through a friend in Singapore who have interest in buying hotels in Asia. Now i have 3 properties in Phuket, Thailand that is up for sale and would like to introduce these properties to them but I do not want them to override me after showing the property name as they will go direct to the buyer. How can I protect this interest of mine. Hope you can help me. (Norizan, Singapore Feb 2010)


Hi there, Norizan!

Your question is, how can you protect your interest as selling agent.

There are three elements that protect your interest to commissions. You must have ALL of these three BEFORE you consider yourself "legally entitled" to commission:

1. Your authority to as act as a broker. Evidenced by a professional license.
2. Your service contract with the party who will pay you commission (buyer, or seller, or both). Evidenced by Brokerage Agreement.
3. Your role as a procuring cause, meaning, you are the element that made the real estate and the transaction "known" to both parties (buyer and seller). Evidenced by the officially-stamped Receipt of Offer to Sell.

If you have these three, they may go direct to each other, and if the transaction will consummate, you can still claim compensation through proper court proceedings. While your claim is in process in court, you can put a cloud of title on the property, meaning, if they will not pay, you will claim that you own "part" of the property equivalent to your claim.

By the way, two or more persons may form a partnership to provide the three elements. So, if you lack at least one element, you may look for someone to partner with to complete the three elements. In any case there is partnership, it is always the professional licensed broker who will take the lead role, responsibility, and accountability.

If there is anything else you need, please feel free to speak your mind to me. Thank you.

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