Relationships between real estate investors and agents are likely to result in conflicts of interest every now and then. Contrary to popular belief, however, they are incredibly valuable and remain a good strategy for buying and selling properties. Therefore, hiring a real estate agent can have significant advantages to those who know what they are doing.
As the U.S. housing market picks up, new real estate agents enter the business and existing Realtors become busier than ever. An increasingly common question among real estate investors is whether or not they can legally fire their real estate agent and replace them with someone else.
This frequently becomes an issue when buyers’ agents aren’t performing to their expectations. Similarly, it can occur when agents aren’t receiving traction on offers, aren’t presenting the offers, or aren’t willing to negotiate according to their client’s wishes.
When this happens, can you fire your real estate agent and replace them to get the deal done? More importantly, can you do it without getting sued or owing them a commission?
Obviously, most Realtors will at least threaten to sue in this situation. A few rogue brokers may even go after real estate investors and investing companies for their paydays, depending on when the deal took place. Of course, this doesn’t mean they’ll win, are entitled to it, or can’t be subject to complaints in the reverse. Everyone is susceptible.
Most reputable real estate brokers will choose to protect their reputation. They will try to avoid complaints or lawsuits when confrontation arises.
However, if it does come down to a duel in the courtroom, it is really all about who was the ‘procuring cause of the sale.’
There are, of course, differing opinions about what this actually means. If an investor can show that the deal wouldn’t have been done, even if an agent brought them the listing, it shouldn’t be an issue.
So if your Realtor isn’t performing, then first try to address the situation with them and their bosses. If that doesn’t work, find someone that can get the deal done.