Can a broker charge a fee without a party’s consent?

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A toy house and $1 bills on top of a blank contract

08/11/2016 | Author: TAR Legal Staff

A friend called me after his recent closing to ask about a transaction fee listed on his Closing Disclosure form. He says it was charged to him by the broker representing the other party. When he asked the broker about the fee, she said she always charges this fee to both sides of the transaction.

My friend didn’t know about or authorize this fee. Is the broker in violation of TREC rules or the Code of Ethics by charging this fee without his authorization?

According to the conduct described, that broker may have violated the Real Estate License Act. The act states that a broker is in violation of the Real Estate License Act if he or she receives compensation from more than one party to a transaction without full knowledge and consent of all parties.

Article 7 of the Code of Ethics also prohibits a REALTOR® from accepting compensation from more than one party to a transaction without disclosure to all parties and the informed consent of a REALTOR®'s client. The conduct described in this case may be a violation of Article 7, and it might also constitute a violation of Article 1, which requires that REALTORS® treat all parties honestly.

Get more legal questions and answers on texasrealestate.com.

Categories: Forms, Legal
Tags: legal, legal faq, fees, code of ethics


Comments

Sheila Moran on 08/22/2016

Another reason WHY the Agents involved in a transaction need to see the settlement statement.  We write the contract that stipulates how everything will be done.  Our responsibility to make sure it happens.  #TroubleWithTRID and the Agent being pushed out of the loop.

Dena Smith on 08/11/2016

This is exactly why I review the closing statement carefully prior to closing. I catch all kinds of errors like this. No way can another broker legally charge my client any fees without their knowledge or consent.

Lisa Weissgarber Harder on 08/11/2016

I believe the title company must have made a mistake.  The “other ” real estate company can’t charge my client….

Audrey Lane Mabray on 08/11/2016

Sorry Rodney, I believe this is an entirely different subject from the article about “can a broker charge a fee?

Rodney D. Hetzel on 08/11/2016

I have a client that owns a condo, she travels a lot and when out of town the upstairs neighbor installed ceramic tile floors, which is a violation of the HOA Rules and Regulations, the condo was sold by a Realtor that lives in the complex and whose office sells many units there/almost exclusively. In our bylaws that we should know the properties we are selling. This same Realtor told my client that she “had better get used to it, there are marble floor in the unit above me” this to me is an admission of knowing about the problem. What Realtor
Rule ot rules have been violated in this situation?

Audrey Lane Mabray on 08/11/2016

Sounds it could have been the title company fee.  Possibly? The question was too vague and might not have been described correctly by the friend.


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