A year ago I entered a 1-year Buyers Representation Agreement with an agent at ERA who was supposed to be an expert on "short sales." I agreed to a 4% compensation to be paid through escrow at closing, out of the purchase funds I deposited.
After one deal fell through 5 weeks into escrow because a lender pulled a lock-in rate for our loan, it was apparent the agent blamed me. He nevertheless agreed to submit another offer for me on a "short sale" peroperty.
My first clue that he was acting with a grudge towards me was when it took him 6 days and three prompts from me (as well as a call by me to the seller's agent) to get the offer to the seller. Every time I called the agent to inquire about whether the lender had accepted the seller's "short" terms, thus my offer, he lectured and admonished me about how I never should have pulled out of the earlier (much higher-priced property), and about how short sales take so long, and I will probably regret having bailed on the earlier sale... This went on for almost two months. Finally, I learned that the agent withheld a building inspection the sellers had given him (to give to me), until after I spent another $235 for second inspection.
I got tired of this agent's behavior and believed that he was incapable of acting in my interest while harboring such an obvious grudge. So I told him I no longer wanted to work with him and would be looking for a different agent. I sent him an e-mail reiterating this. I thought I had fired him. He even agreed to allow another agent from his office to take over, but never really gave the other agent authority to negotiate when problems arose in escrow.
The bank apparently expected to Net of $115,000 instead of the $113,000 after closing costs. This left $2,000 in closing costs unaccounted for (after all of my money was already in escrow) and nobody really explained this to me until much later, since I was pretty much unrepresented through escrow. The escrow was completely stalled. The seller's agent offered to put in a share of his own money, but my agent refused to put anything in or to help out at all. I learned about all of this through the escrow agent. The escrow agent even tried to circumvent the fired-turned-obstructionist-agent by talking to his broker, but the broker also refused to help.
Eventually, I agreed to pay another $1,000 above the purchase agreement, so that escrow could close. I thought it was bad enough that an agent I fired was obstructing the closing process, but it was an insult that he nevetheless got paid commissions at the close of escrow.
My escrow settlement statement showed in the "buyer's column" that 6% of the funds I paid were used to pay commissions. I though I had performed my obligations under the Buyers Representation Agreement.
I submitted a complaint with the DRE and the agent's Association. There was a hearing held and outside on the day of the hearing the ex-agent handed me a demand for the unpaid balance of 1% commission. It turned out the aex-gent was paid only 3% at the close of escrow. I refused to pay any more because: a) I believed I had provided sufficient funds to pay his commission, b) If there was an error, it was made in escrow, not by me, and c) The 4% obligation was void because I properly cancelled the Representation agreement in writing, citing "material issues" pursuant to a reciprocal cancellation clause of the contract.
I am now being sued by this agent whom I fired because of the bad job I felt he was doing, and who probably should not have been paid the 3% he was paid.
So, buyers, watch out for this agent/brokerage. Do not, under any circumstances sign a Buyers Representation Agreement! They are unnecessary and can only hurt you. All regular residential purchase agreements provide for compensations to agents without locking the buyer to one agent (for an extended period of time) if a deal should fall through or after the buyer has a falling out with the agent. This agent and ERA, I believe abused this contract and used it to collect on without performing under it.
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