Problem with Realtor and Land Contract Sale

[MichiganT]

Michigan

My contract with my realtor expired, instead of extending the contract, I decided to try selling it myself. Afterward, I ran into a friend who I happened to know had looked at the house previously. He and his wife said they were still interested, and asked if I would consider a Land Contract.

After we came to an agreed upon selling price, I had another realtor draw up a land contract agreement for a $500 fee.

Now, the previous relator is suing me for her commision on the sale of the home because she initially showed the property to the party. The 60 day period at stated in my contract had not expired. Am I correct to assume that she should not receive a commision until closing since this is a land contract??? She wants the entire commission immediately.

 

[nextwife]

Michigan

My contract with my realtor expired, instead of extending the contract, I decided to try selling it myself. Afterward, I ran into a friend who I happened to know had looked at the house previously. He and his wife said they were still interested, and asked if I would consider a Land Contract.

After we came to an agreed upon selling price, I had another realtor draw up a land contract agreement for a $500 fee.

Now, the previous relator is suing me for her commission on the sale of the home because she initially showed the property to the party. The 60 day period at stated in my contract had not expired. Am I correct to assume that she should not receive a commision until closing since this is a land contract??? She wants the entire commission immediately.

The realtor is due a commission when the vendee/vendor (LC) contract closes - NOT when the vendor provides a "Deed in Satisfaction of the Land Contract". If you entered into an agreement with a buyer, who was shown the property during the listing period, and the contract was entered before the expiration of the realtor protection period, you owe a commission the moment the LC is closed, not after the end of the LC contract. I bought a house on an LC, and I became the vendee OWNER of the RE as soon as we did the LC and recorded it. Five years later, when the vendor did the Deed in Satisfaction, the TYPE of ownership interest changed to Fee Simple, but I had been the owner, with rights to alter, repair, pay property taxes, deduct interest and property taxes, determine parties-in-possession and so on since the LC.

I've been involved in the closings on hundreds of LCs, and commission is always paid when the LC is executed and the agreed buyer down-payment given to vendor (unless broker and seller AGREE to something different).

 

[HomeGuru]

The realtor is due a commission when the vendee/vendor (LC) contract closes - NOT when the vendor provides a "Deed in Satisfaction of the Land Contract". If you entered into an agreement with a buyer, who was shown the property during the listing period, and the contract was entered before the expiration of the realtor protection period, you owe a commission the moment the LC is closed, not after the end of the LC contract. I bought a house on an LC, and I became the vendee OWNER of the RE as soon as we did the LC and recorded it. Five years later, when the vendor did the Deed in Satisfaction, the TYPE of ownership interest changed to Fee Simple, but I had been the owner, with rights to alter, repair, pay property taxes, deduct interest and property taxes, determine parties-in-possession and so on since the LC.

I've been involved in the closings on hundreds of LCs, and commission is always paid when the LC is executed and the agreed buyer down-payment given to vendor (unless broker and seller AGREE to something different).

**A: I agree. For purposes of commission a land contract is considered a bonafide sale of the property.