I Have Exercised Otp, Now Seller Agent Wants Money From Me!

[foldme 0]

Hi all,

Just wanted to share my story with the forum and hopefully get some advice.

As soon as I started to looking for my flat, I had always done my own homework and legwork and never relied on an agent to help me source for flats. There were a couple who offered to be my agent which I accepted. But they never really found what I wanted so I resumed looking on my own.

About a week ago, I found my dream home on my own through property websites and after some haggling, managed to close the deal at a price I was willing to pay.

I then met the seller and his agent a week later to exercise OTP. Seller agent helped to talk me and seller through the forms we had to fill up so we signed on everything that was required for OTP. After which I proceeded to pass seller the cheque amount of 5k for exercising OTP.

Then the seller agent pulled me aside and told seller he had some business to discuss with me. So I stepped aside with Seller agent and this was when he took out another form and told me that this was for his commission. To which I told him that he wasn't my agent and I wasn't obligated to pay.

He continued to press me and said, "It's standard procedure!" So I asked to see documents reflecting this statement. He couldn't show me proof but kept insisting that i pay him the commish anyway since "This is how it's done!".

I stood my ground and eventually he relented and asked me to make a counter offer. I told him there is no counter offer and that if he wanted commision he should have got me to sign on this form before we even started negotiations.

In the end, he told me to go back and think about what I can counter offer while we proceed with making our first appointment.

My question is this:

What can this agent do to screw up this deal between now and my first appt?

And since buyer and seller have already signed OTP and cheque for 5k is given, does that mean if seller defaults I have legal grounds to pursue the matter?

Thanks for reading this long post and I hope someone can help!

[bepgof 20]

Agents are paid not only on help sourcing house, but processing paper work & coordination between buyer/seller as well. Legally, you can don't pay this agent, but to process paper work yourself. Or you can negotiate the 1% comm to certain %, I would say depending much on COV value.

My suggestion is, if COV is

1. 5-10k: pay 1% to him/her

2. 15-20K: pay 0.5% to him/her

21K and above, no com

1. Make sure sign the agreed % in paper.

2. Hope you have the OTP with u now, see pg 4/10, clause 11. Put this figure as low as possible to your advantage, 90 days = 3 months is maximum. If this is the case, means, she legally could submit the resale application any day within 90 days.

3. After resale submission application, wait for another 13 wk for allocation for 1st appointment, then wait for another 8 wk for 2nd appointment, die la. Buy a hdb take so long! Condo can transact(exchange hand) within 8-10wk.

4. Actually, seller must sign OTP first, then buyer sign and agent as witness signs.

5. See OTP pg 2/10, clause 3.2. If seller refused to sell at this point. You're entitled to get the money that u have paid, back. Plus compensations, like transport fees, wages loss ,etc.

I asked agents to source as well as myself actively look out on internets/newspaper for my "dream home". Found by myself from newspaper, COV 10k, I paid seller's agent 1% to act on my behalf. Till now, we still keep in touch..

[therat 18]

don't think the agent will screw up the deal.

But as you didn't pay the commission, the agent is not required to service you.

[foldme 0]

bepgof: Thanks for the reply. So basically, I am just paying the agent processing fees yeah? I think its fair to pay for that but definitely not the full 1% since my COV is over 21k.

Can I then ask, other than all the OTP stuff, is there still a lot of paperwork the agent needs to do?

therat: thanks for the advice!

Thanks for reading, all.

[therat 18]

bepgof: Thanks for the reply. So basically, I am just paying the agent processing fees yeah? I think its fair to pay for that but definitely not the full 1% since my COV is over 21k.

Can I then ask, other than all the OTP stuff, is there still a lot of paperwork the agent needs to do?

therat: thanks for the advice!

Thanks for reading, all.

u can neg the commission.

No rule say must die die pay 1%

I'm also walk-in buyer. We neg with the seller agent.

[bepgof 20]

Need to pay him/her for processing resale application submission(3 modes).... When apply must submit stuff like IC/MC/VR..May refer to HDB web's procedures on self-processing.

If u use bank loan, must get "letter of offer" from bank, during 1st appointment. Wise to approach bank for loan when 1st appointment day draws near. Usually, the letter valids for 6 months and comes with legal impliction (penalty for cancellation, or no disbursement within 6 month). Now, resale application take time, 1st appt takes 13 wk !Bank will use u for pay slip/IR8A/valuation report/cpf account/current liabilities/loan type.....etc. I almost "kena" last year. CPF concessionary loan procedure not sure.

Wait for 1st appointment (pay COV at this point for HDB loan) follow by 2nd appointment(All money exchange hand for bank loan).

[foldme 0]

Thanks for the advice!

bepgof: We've already done the resale application submission and have submitted photocopies of my personal details. I have applied for a HLE loan that has been approved so no bank loan procedures in my case.

Update: The agent has submitted the application and says will inform me when we get a date for 1st appt. Any idea how long between submission and notification of 1st appt? Also, agent has not broached topic of commission in the last few days and maintains we can discuss at a later time. I've also offered a token sum to agent but did not get a reply for my offer.

[ngunadi 2]

Please check whether the agent has really submitted the application.

Fyi, my agent can even check the earliest slot for the 1st application despite we have not submitted anything.

You should get the date within 1-2 days?

[coldflamez 0]

If the application is submitted online, the agent should be able to know immediately when the 1st appt date is. You might want to be careful in case the agent tried something funny behind your back like trying to get another seller... Think someone in the forum has mentioned something like that before...

[foldme 0]

Hi ngunadi and coldflamez,

The seller agent has just informed me the date of my 1st appt. So at least that is taken care of, but to be on the safe side, I think I will be printing my own set of documents required for the 1st appt.

The other thing to worry about is whether I need an agent representing me at the 1st appt with HDB. If yes, I'm afraid the agent may refuse to be my representing agent at that time and not sure if that will cause a major delay.

Thanks for all the advice! Much appreciated...

[therat 18]

don't need representing agent during 1st appl.

The main and key person is seller and buyer

Just remember to get seller contact number, in case the agent was "not contactable"

As now the 1st appointment was like 3 mth time frame. just do a friendly SMS to remind them abt the 1st appointment date.

[Phantom 1]

don't need representing agent during 1st appl.

The main and key person is seller and buyer

Just remember to get seller contact number, in case the agent was "not contactable"

As now the 1st appointment was like 3 mth time frame. just do a friendly SMS to remind them abt the 1st appointment date.

wooo... who's got the nice shiny medal ??

[kiddboy 0]

just curios, what is the % the seller pay for the agent commission and what is the % the buyer pay the agent commission?

[bepgof 20]

just curios, what is the % the seller pay for the agent commission and what is the % the buyer pay the agent commission?

For HDB resale

1. Seller to agent: usually 1%, but if sign exclusive agreement then 2%. Choose a good(resourceful, honest, sincere....) agent & sign excl with him/her(agreem lasts 3 mnth) give some "peace of mind" to both seller & agent. This gives room for agent to "cobroke" with buyer's agent.

2. Buyer to agent: If u source the flat on yr own without agent, suggest u don't pay any comm to seller's agent, you've right to do that. Anyway, be prepared the agent will "sneakyly" lead you to sign the comm agreement without your true understanding. Make it clear verbally in the beginning: I am not paying u any comm.....

3. Rather common for buyer paying 1% to seller's agent. I think, as buying/selling procedures becoming more aware, transparent and simplify, buyers will choose not to pay.

4. If you buy private, do not need to pay yr agent any comm. It is the norm.

[kiddboy 0]

i got it. yes, i sign excl with my agent and he sold my flat within 3 days with high COV. i signed his 2% comm agreement after the sale (at first i thought 1% or i may be hear from him wrongly).

the same agent also help me to source for my new flat and his is charging me 0.5% comm. after we got the flat we want (within a month) , he submitted all paper and got us the 1st appointment together with buyer (of my flat) and the seller (the flat i am buying from). all three pairs will be at the 1st appointment.

Edited March 19, 2010 by kiddboy