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Attention: Commercial mortgage brokers, commercial loan officers, residential loan brokers and residential loan officers: How about no more games or worries about being paid or how you will work with your borrowers on your hard earned commercial loans requests? Nothing stings quite like NOT being paid on a deal after you've put months into it and succuessfully delivered for your client to have either them or the LENDER screw you. You've got to have a commercial mortgage broker fee agreement in place with your borrower.
It literally has never been more important to do this right. Due to the "broken" commercial secondary market, very few lenders are willing or able to pay yield spread. We have to get paid the old fashion way (When was the last time you talked to a SBA lender? Market YSP is a pathetic .5%...).
In addition, it has never been more important, to spell out exactly what your relationship is going to be with your borrower. Do you want an exclusive relationship? To be paid a retainer? To have the borrower reimburse you for expenses incur while packaging/shopping their loan? Do you want to be paid, if you produce a bona fide commitment to fund, regardless if the borrower "passes" and goes with their local bank that they never mentioned to you? A legitimate broker fee agreement goes way beyond just how and when you will be paid.
Have you heard your lenders say to you "oh, we don't have formal agreements with brokers, but no worries, we'll pay you outside of close? We look at a lot of deals and it would be just to cumbersome to make a separate agreement with each broker." Or how about this one "Why would we not pay you? You're a valuable referral source and we what to keep you around for years to come."
Commercial Mortgage Broker Fee Agreement
Or here's one I used to hear all the time from borrowers, after submitting a term sheet that fits exactly what they said they wanted and what I quoted (and I put 10 to 20 hours into the deal) "Oh, we know xyz bank... not to be rude but why do we need you?" Or how about "Jeff (me) we've known each other for years, I will pay you. But, the last thing I want to do is get my attorney involved in reviewing or writing some kind of fee agreement. It will cost me hundreds if not thousands of dollars. Lets get this thing going first, find a real loan then we'll take care of you at the appropriate time."
Bottom line, if you haven't been screwed by either a borrower OR a lender, then you're probably not doing as many deals as you want (OR YOU ALREADY HAVE A LEGITIMATE FEE AGREEMENT). If you're not protected you WILL get screwed, it is just a matter of time. There aren't a lot of words more frustrating to hear than "well, what do you have in writing?" After diligently working on a file for months, only to realize that you will not get paid or only get paid a percentage of what you were originally quoted. Or have to take someone through court with weak documentation. You have to have your commercial mortgage broker fee agreement signed and in hand.
Fee Agreement for Commercial Mortgage Brokers
Believe me when I say that we have learned this lesson the hard way. It has happened to us on multiple occasions where well known "reputable" banks simply changed what they said they would pay us on YSP. Many times internal emails won't cut it either. Or, borrowers will try to give you a sob story on why you'll have to wait or worse "what do you mean, I thought the bank pays you" (on deals where we had to get paid outside of close).
You got to have it in writing or you are at their mercy.
Quick story here, I had three loans in process with a very well known small balance lender. We had done many transactions with this lender and became relaxed that this issue won't come up. We stopped formalizing our agreements with them based on the ongoing relationship. Surprisingly, our Business Development Officer was fired and our files in process were given to another BDO that we did not know. All three loans closed within one week of each other (oddly). When we received our check it was 30% lower than what we originally agreed with the previous BDO. When we called both the new BDO and his bosses, they all said "well, what do you have in writing". And yes, we ate it...
On some deals brokers are not "welcome" (by the bank) and we therefore have to be paid outside of close. If you depend on the borrowers integrity to pay you, you'll have some frustrating stories to tell.
Fee Agreement for Commercial Mortgage Brokers
We spent $750 for our attorney to write this 5 page commercial mortgage broker fee agreement. It has protected us well and stood up in court three times. One of the disputes was on a $8,000,000 hotel deal and a $80,000 fee. And yes, this time we got our money. You can alter it for real estate, equipment or business acquisitions and/or a combination of all three. Also, it can be easily changed from exclusive to non-exclusive representation.
We are giving it away for $99.95. Now $59. NOW ON SALE FOR $49.95. Again we paid $750... Also, keep in mind the agreement will be emailed to you instantly (in Word so you can easily change it) and you will NOT have any shipping costs. And yes, we offer a full 100% money back guarantee for those of you that are as cynical as I am.
Jeff Rauth
President
CURRENTLYON SALE. WILL END JUNE 30TH, 2009.
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OR, buy the Combination Commercial Fee Agreement Package, which includes:
- The above commercial broker fee agreement (Normally $99.95)
- Co broker fee agreement (currently $39.95)
- Non Circumvent ($39.95)
Buy separately for $180. We paid our attorney $1,225 for all three. Or get all three for $89.95
NOW FOR ONLY $64.95. NOW ON ONLY $54.95. SALE ENDS MAY 15TH.
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Ps: Remember, YOU risk nothing. I'm giving you a 60 day, 100% MONEY BACK GUARANTEE and am taking all the risk. Why would I do this? 1. these are legitimate agreements and I'm confident you'll agree after you own them. 2. Because I know the day will come when you will be stuck on a deal and will want to co-broker it with us and you'll probably not want to burn any bridges with a viable source. So buy it now and protect yourself and your interests. Don't let yourself get pushed around.
Disclaimer: The information provided in this site is not legal advice, but general information on legal issues commonly encountered. Commercial Finance Advisors is not a law firm and is not a substitute for an attorney or law firm.
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