How is this all free to me as a buyer?
The seller always pays the commission on a home you buy. A real estate agent never charges the buyer for their services. That is why you pay the same price for a home whether or not you use a real estate agent: The seller usually has already agreed to pay the listing agent a fixed commission - say 6%. So whether you buy the house by yourself or through an agent, the listing agent gets a 6% commission. Therefore, in most cases you cannot approach the seller for a discount, since the seller is paying 6% no matter what. It will be either 6% to the listing agent, or a split of 3% to the listing agent and 3% to the buyer's agent. This is where we come in, we give you half of our 3% in the form of a rebate).
Are rebates legal in every state?
Rebates are legal in the majority of states. However, some states haven't joined the bandwagon yet. Those states are: Alabama, Alaska, Iowa, Kansas, Louisiana, Mississippi, Missouri, Tennessee, New Jersey, Oklahoma, Oregon and Wyoming. If you live in one of the states where rebates are not legal and you want them to be, please write your Senator & Congressman, or send us an email, and we will forward it to the Department of Justice! For now, we can donate your rebate to the charity of your choice in these states. You will be helping your favorite charity and receiving the tax benefits of making a significant donation.
Do I have to use a certain lender if I use you?
We are completely separate from lenders. You can still use whichever lender you want (including lenders offering incentives as part of new construction builder programs). We simply connect you to a Realtor who is participating in our rebate program, and will share his commission with you at closing. We do not require you to use any specific lender.
Do I get real cash at closing?
Yes! The rebate is put right on the HUD-1 closing statement, so you can bring less of your cash to closing, and use your rebate cash instead, to pay closing costs or etc.
Does a rebate have to be disclosed to the seller?
No! The rebate is a confidential agreement between you and your agent.
How do you make money?
Our network of agents keeps half of the commission. They feel that you deserve a rebate because you are actively involved in the search process. Technology makes it easier for buyers to perform some of legwork traditionally provided by an agent. This frees the agent's time to focus on the part of the deal the agent does best, negotiating, contracts and closing the deal.
Does the rebate have to be listed on the HUD-1 statement, or can it be given after closing?
According to Fannie Mae guidelines and federal laws, all credits must be given on the settlement statement (not after closing). Failure to disclose the payment to the buyer on the settlement statement can constitute a false statement to a lender (a federal crime), and is also a violation of the License Law and Commission rules. As long as the rebate is disclosed on the HUD-1, it is perfectly fine in the most states, and most lenders do allow the rebate on the HUD-1. However, if your lender will not allow the rebate on the HUD-1, then the only way for you to get the credit would be to have the seller lower the sales price by the amount of the rebate. This is why it is important as a buyer, to select a lender who will allow the rebate on the HUD-1 statement.
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