Beware of Brokerages That Offer to List Your Home for 1%

Perhaps you’ve seen the ads from a real estate company promoting a 1% listing fee. Some would consider this deceptive advertising, since the details are buried in fine print. In Colorado, you’ll pay an additional 2.8% fee to compensate the agent representing the buyer. That alone brings the fee up to 3.8%.  Also, the advertised rate requires that you buy your replacement home with the company. It’s all in the fine print.

Read the fine print! (You have 1 second to do so on this TV commercial.)

Would you really want to do business with a company that tricks you into granting an appointment by misrepresenting what they charge to sell your home?  We charge a little more, but you get far better marketing and, if we sell it ourselves, you could pay as little at 3.6% and get free moving to your new home.  Call Jim Smith at 303-525-1851 for details.

Note: Technically, the commission paid to the buyer’s agent is part of the listing commission even though it is paid by the seller at closing. Therefore advertising a 1% listing fee is in itself a lie. The listing contract would show 3.8%, not 1%. The fine print in the commercial also states that the 1% “listing fee” is increased if no commission is owed to the buyer’s agent. Therefore, 1% is not obtainable under any circumstance, although a listing agreement could be modified by the listing agent since commissions are always negotiable. I’m just referring to their “standard” commission arrangement as they are advertising it.