Real estate brokers are a crucial part of property transactions. They handle contract preparation, oversee sales and purchases, and work with residential homes, land, and commercial properties. Despite how helpful they are throughout the process, disagreements about commission payments come up more often than you’d think, often leading to a broker commissions dispute.
Brokerage commission is the fee a broker receives when they successfully close a deal. When disputes arise over commission, there are a few essential things to keep in mind. In New York, brokers need a state license to collect commissions. Also, real estate agents can’t sue for commission on their own—the broker has to sign over that right to them first.
This is where the Real Estate Broker Contract Agreement comes in. This written contract gets created when a property owner lists with a broker. It’s important because it spells out what the broker’s going to do and whether they’ll get paid commission. If there’s no contract, the law assumes the broker will get their commission once they’ve done their job. Indeed, have you ever had a broker commissions dispute over proving who initiated the sale?
Another issue that pops up is when nobody bothered to specify the commission amount in the agreement. When that happens, the broker will get whatever percentage is considered fair and reasonable for that type of transaction.
If you are in a dispute over a brokerage commission, please contact us at (212) 619-1500.