Sell DIY instead of a Broker or Purchasing without a Broker

[Reisenbeis]

@Reisenbeis Glad to hear this worked out for you. Sometimes families want out (for example, a spouse dies) and they don't know the value, may be in grief and shock. But that's why they hire a broker who knows the market.

Was this a listing that the broker was representing (and was getting paid a commission by the seller) and she negotiated down price with the owner/seller that she was representing? or was this offered by a different broker?

If this was the former this is a dereliction of duty to get the best price as representative broker for the seller. The broker should know these deeds are worth much more.

She was not working in a dual agency situation. She was just representing me as the buyer.

 

[CalGalTraveler]

I am glad it was not Judi's. It sounds like she earned your commission given your situation. This dereliction is on the selling broker then.

What most buyers and sellers don't realize is that most timeshare brokers work on a fixed commission. Unlike a primary home sale where there is a commission percentage of final price, there is little if no incentive to get the seller the best price. It is a volume business so closing the deal is the only way they get paid no matter what price the seller ultimately nets. Sellers may be looking to the broker to get them the best price, but selling brokers are not incented to do so.

 

[GT75]

This dereliction is on the selling broker then.

Well, it depends on what the seller’s instructions were to the broker. The seller could have said, “sell as quickly as possible” for some reason.

 

[CalGalTraveler]

Well, it depends on what the seller’s instructions were to the broker. The seller could have said, “sell as quickly as possible” for some reason.

It's possible and some sellers don't care about the difference. However I believe the actual population is quite small. $1500 is a lot of money for many people.

But don't you think it is ethical/incumbent on the broker to advise the seller as to what comps are selling for given they are paying a fixed commission of $750 - $1500+ for this broker to get the best price for them?

Perhaps the family is in grief/shock from death or failing health so it is especially incumbent on the broker to advise and disclose so they can make the right decision. That is only further damage to a seller that is vulnerable and is trusting the broker.

Bottom line: The selling broker gets the same commission no matter the selling price so it is possible the broker wanted to close quickly to earn the commission and move on. It is important to understand how people are compensated so you know how they will act.

 

[HuskerATL]

It's possible and some sellers don't care about the difference. However I believe the actual population is quite small. $1500 is a lot of money for many people.

But don't you think it is ethical/incumbent on the broker to advise the seller as to what comps are selling for given they are paying a fixed commission of $750 - $1500+ for this broker to get the best price for them?

Perhaps the family is in grief/shock from death or failing health so it is especially incumbent on the broker to advise and disclose so they can make the right decision. That is only further damage to a seller that is vulnerable and is trusting the broker.

Bottom line: The selling broker gets the same commission no matter the selling price so it is possible the broker wanted to close quickly to earn the commission and move on. It is important to understand how people are compensated so you know how they will act.

I would think that the broker would advise the seller of a reasonable amount based on current market conditions...

 

[CalGalTraveler]

In theory yes. Clearly this was not current market conditions based on recent comps for similar deeds. I suspect that the listing was in a general real estate MLS which is not a great source for promoting timeshares. Perhaps the selling broker was not a timeshare real estate broker and was ignorant as to where to best list timeshares. So perhaps the property sat a long time on the MLS because of that ignorance and the family became impatient.

We will never know whether this broker acted responsibly by following the wishes of the seller, or was an inept timeshare broker, or pushed the seller to sell so they could get their commission and move on. Regardless this is a great case study and cautionary tale to help owners to understand what brokers will and will not do for them when it comes time to exit.

 

[drucifer]

I am glad it was not Judi's. It sounds like she earned your commission given your situation. This dereliction is on the selling broker then.

What most buyers and sellers don't realize is that most timeshare brokers work on a fixed commission. Unlike a primary home sale where there is a commission percentage of final price, there is little if no incentive to get the seller the best price. It is a volume business so closing the deal is the only way they get paid no matter what price the seller ultimately nets. Sellers may be looking to the broker to get them the best price, but selling brokers are not incented to do so.

Realistically, most brokers of homes also don't care that much about the selling price.
That is, if a house is worth $500k, and they get $450k, essentially taking a 10% cut to market value, the commission is 6% and split between the buying and selling broker at 3% each (at least around here).
So would a broker prefer an easy sale with a $13,500 commission and move on to the next deal, or work really hard for a $15,000 commission? Most brokers will take the easy sell and try to do a couple more of those a year than struggle to get the full value (or more) out of a house.

 

[mountainboy]

Not always. Had one a while back where they used something else and it was a total train wreck.
But I do agree that Grand Vacations title does get things done very quickly (and expensively, IMO, compared to LT Transfers)

Same experience here :-(

 

[mountainboy]

An interesting viewpoint(s) I've seen on the FB pages for HGV "ownership" (there's two I'm in) regarding resale purchases is that folks are very leery of resale purchases period EVEN THROUGH BROKERS/REALTORS. Thus they feel comfortable buying direct (and paying a LOT more). While I personally don't see that viewpoint (I'm all about saving money--haha and learned my lessons the hard way), I can definitely see why folks (who have that viewpoint) would also want to sell via Broker/Realtor vs. DIY.

I have sold units DIY on FB and used LT Transfers both times. Worked flawlessly/great.

Agree, LT Transfers is AMAZING!

 

[mountainboy]

Agree that this is much simpler than selling "normal" real property particularly with HGVC. I don't have any experience with other systems but HGVC provides the estoppel to confirm ownership interest and identify delinquent MFs due - and will not let a sale proceed if there is an encumbrance (mortgage) on the deed. Combine that with a reputable closing company that sets up an escrow for the closing, that really takes away the fear of fraud.

I'm just getting in the system so I don't expect to sell anytime soon - but when I do I plan on doing it myself.

re: Selling DIY. Because it is deeded many owners equate buying and selling a timeshare to the complications of buying and selling a home. Far from it. You use Redweek verified to verify the deed exists, and a reputable 3rd party escrow company. That's it. No inspections nor disclosures nor staging nor open houses like a primary home. No more difficult than writing up a listing and renting out your timeshare week on Redweek.

What value does the broker bring to a timeshare sale? I have used brokers who have made errors on the initial contract**, put clumsy errors on the listing, have been unresponsive about updates and slow responding to buyers, and did no checking of the final paperwork. The third party escrow company communicates with the developer to set up your account and obtain the estoppel. In one case we had to file a corrective deed because of an error we discovered. Brokers were no where to be found.***

Many owners don't even know DIY is an option. Yet I see on TUG and Facebook people arguing about $1000 and $2000 offer differences yet they don't question this element of the sale. IMHO I would much rather see an owner earn this money because it is doesn't require much effort.



** The escrow closing companies will provide you with standard sales contracts where you fill in names of the seller and buyer in the blanks. You don't need a broker for this.
*** We have never worked with Judi so YMMV.

Agree 100%.

Much simpler buying from individual owner; able to review points statement, zero balance on HGV website/app and even deed on Clark county website (for Vegas deed) before moving forward with transaction. Esp with LT Transfers, Estoppel etc, very easy process & very fast/efficient communication.

With broker, she was like, 'your closing co will see on Estoppel' (re clean title, zero balance etc), 'not my job' (?)
You would think one would/should get more better svc/better communication with broker, for paying extra/premium to buy from them, but was exact opposite experience for me

Also, do NOT use LT Transfer with a Broker. LT has to route everything through the broker (with inherent slowdowns). Every communication is sent separately to seller vs the buyer, and vetted through broker 1st. More fees (LT also charges an extra $100 fee on top of usual fees), for extra work for them to send everything to broker 1st etc. + Admin Fees ($500) and commission for broker (usual $1000-1500, from seller, but effects 'sale price')

The brokers (& their staff) are likely too busy (& much slower in responding), so everything moves much slower.

I will likely never buy from broker again, unless deed unavailable elsewhere