No, not yet. But it's great that you did and in the same situation, I would have too . . .

With the market being the way it is today that is a good idea to take the Marketing money upfront for a rather large listing. To sell the home properly you need to advertise this type of house in some First Class publications. Make sure you get your Sellers buy in on the ads that you are going to placing. when they pony up 10k like that they want to make sure they like what they see.... Good luck with your listing.

John

Joe will you stop bragging!  Geesh...  We have taken over priced listings and do not spend much money until they have reduced to where they can sell.  We have never taken a deposit.  Actually never heard of that until recently here on Relib.  I am waiting to hear about this really great idea LOL  

Jana

Jana, it's done in many areas . . . interestingly, my clients who are fulltimers on the East Coast and some of the N Calis almost always ask me how much up front for advertising.

I tell them it's included in my fee but if it's a unique home or high end property, the fee may need adjusting to account for that. So we wax optimistic that the property will sell and we will get paid. Leap o faith, eh?

I've taken listings in the past and put $2,000 to $4,000 into the marketing and then they decide (a) not to move; (b) want to take it off the market for awhile or (c) won't reduce the price.  

So anything above $500K, I now ask for a deposit up front for marketing budget that does get refunded at the sale of the home.  The homes sell because the owner is more serious when they put the money up front.  The house is clean, the front yard is appealing, etc.  

Same holds true for any staging accessories that are provided - I give them receipts and they pay me right on the spot.  

On the flip side -- an agent in my office took a listing with this marketing fee.  The wife wanted $1.3M for the marketing price and the husband wsn't sure.  The appraisal, done by a certified appraiser, was valued at $1.3M.   However, the market analysis final adjustments came between $1.5M and $1.8M.   This didn't make sense.  So the marketing price went in at $1.6M - higher than I suggested - however interestingly, the agent got an offer just over the wife's anticipated value and the seller's would negotiate.  Figure that one out.

That's why I think the marketing deposit is business savvy for upper bracket properties.  

We are hired to market property.  If we are not going to do our utmost to expose the property properly, even if it is overpriced - we our doing ourselves a disservice.  For pete's sake, don't take the listing then.

Hi Barb,

I think you missunderstood - we still market it how else would it sell?  We are not a put a sign up and hope of the best kind of agents.  But we have a ton of places to advertise and some cost the big bucks.  So depending on how serious our clients are is how serious we will be.  We get tire kickers on the sales end too!  For example:  We may run a print ad in one paper instead to two.  That kind of thing. As I have never heard of taking a deposit for advertising expenses I would check with our state rules on that.  That maybe why I have not heard of it done.  Or it just doesn't work in our area.  There are plenty of agents who won't charge to get the listing.

Jana

In Florida that is considered an advance fee fund and is a real pain. At least 75% of the fee must be placed in a special advance fee trust fund and the reporting is a real pain. No money can be spent prior to notifying the seller, for approval, and all remaining funds must be returned if the sale does not go through. If you violate any part of the advance fee requirements, it is a first degree misdemeanor and carries a $1,000 fine and/or a year in the paris hilton. In addition the seller can collect treble damages and reasonable attorney fees for any funds misapplied.

Gary I will be CA is following similar rules so is probably why I have not heard of it being done.

J

Hi Joe, personally had similar situation recently.  Advance marketing deposit is great commitment wise !!!!!  and I applaud you guys for having the sack to obtain commitment.  

I do not like to touch money so what I normally do is get CLEAR understanding on marketing gameplan and then divvy up for who pays for what.  In terms of High End or Unusual marketing, I just get Seller to cut check for custom websites / signs / whatever.  Some things I can do in house but the bizarre and custom stuff, just let them cut check.

At least you have gumption to ask for marketing budget.  That is Good !!!

- Radley

Gary, You may want to check current rulings.  I was recently at a post-licensing course and they touched on Advance Fees.  They stated that many of the escrow rules surrounding them have been removed, since not one person has opened an advanced fee escrow account since they put the rule in place.  Basically, people began doing as Radley suggested and had the customer cut the marketing check directly to the vendor.

Janice you may be right. It needed changing. However, advance fees were protected by statute and unless that was also repealed I think The Radley approach is much safer.

I will check into the advance deposit rules but I print out the bills and have the seller pay directly.  When they close, they are given the monies back.  

With marketing listings, I could take more but the seller's who are way off on pricing and don't want to maintain their home - it doesn't motivate me.  In the back of my mind I know the consumer is watching for consistency in marketing.  I know I'm taking this off the thread just a tad, but I try to have all my marketing in place and push "the button" on the day the listing hits the MLS.  If we take three weeks to put all our marketing together while the property is on the market, does that really give our client the upper edge of exposure in a timely fashion?  I apologize if you thought I was attacking.  It annoys me when agents in Chicago just put the listing in the MLS, the sign, the company website, craigslist, etc even for a really great listing.  What I am trying to emphasize is that agents need to let their seller's know exactly what they are going to do for exposure and then follow through.   The consumer is watching.  

Barb

Barb is on the ball !!!!

Why escrow it?

It's only refundable at closing.

Until then it's the Brokers partial fee to use as he wishes. Or, are there more details I'm missing?