What does procuring cause mean?
A procuring cause in real estate is the interaction between clients (a seller or a buyer) and a real estate agent which results in successful transactions, according to Texas Realtors. This term can also be used in other sectors besides real estate.
The agent in this matter is the one who brings together the buyer and seller. This is why the agent is defined as the cause of the transaction. For this reason, the real estate agent will earn a commission. As noted by Realtor, the commission for a real estate agent is usually 6% of the sale price. The commission will be paid by the seller of the house unless there are some negotiations between the seller and the buyer.
Sometimes a buyer or a seller can work with more than one agent until the house is bought or sold. Without keeping track of the entire process and knowing who did what, this could turn into a procuring cause dispute. In other words, each agent could claim that they are the cause of the transaction, and therefore, they are the ones who should get the commission.
>>MORE: Listing Agent/ Seller’s Agent
How to avoid procuring cause disputes?
The best way to avoid procuring cause is clear communication between all parties involved in the sale of the property. That is buyers, buyer’s agent, seller’s agent must all communicate to make sure that there are no confusions on what took a place in the past.
Real estate agents must ask buyers whether they worked or are working with other agents. This question is very important as it will help in avoiding procuring cause disputes.
For example, if a real estate agent showed a buyer a house that turned into a sale under another agent; the original agent could file a complaint and claim the commission.
Tip: Asking the buyer of the house about past agents will help reduce these problems.
Another important step to take is to sign the buyer’s agent agreement. This agreement will clarify the duties of the agent and compensation, etc. Should something come along the way? The agreement will help in resolving it.
