Paying commission to your real estate agent

If you have signed a Contract to sell your property and the buyer defaults (after it becomes unconditional), you will generally be entitled to retain any deposit monies paid.

Depending upon the terms of your appointment with the selling agent, you may also have to pay the agent their full commission even where the settlement of the sale never occurs because the buyer cannot complete the transaction.

Further, the requirement to pay the full commission may not reduce where the deposit monies paid are insufficient to pay the commission amount.

If you are looking to sell your property through a real estate agent, you must read the terms of the PAMDA Form 22a Appointment to Act prior to signing it. If you sign the form and it contains provision for the agent to be paid their commission even if the sale does not settle, you will be contractually bound to make that payment.

In order to avoid this potential situation, ensure you come and see one of our Commercial Lawyers before you sign the PAMD Form 22a. We can review the document and provide you with advice as to your legal position.