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| Do you get paid by the Buyer? |
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Answer: To our big surprise one of the most common questions we face is if we get paid by a Buyer who is interested in one of our listings.
The answer is very simply NO. Since the Seller has hired us, and we owe him fiduciary responsibility, we do NOT charge the Buyer. The Buyer’s only obligation towards the seller, and us, is to respect confidentiality and ethics and to pursue the acquisition in good faith.
Our answer is received with equal surprise from the interested parties, apparently due to the common practice in Real Estate transactions where the Broker gets paid from both parties.
We do not handle Real Estate transactions. It is a completely different field in which we have no knowledge, let alone expertise. Our job has no similarity to the Real Estate transactions, and one of the basic differences accounts for not charging the buyer.
It is NOT our job to bring Buyer and Seller together. Our task, once the Seller has hired us, is the completion of the transaction with the best possible price and terms for the Seller, our client.
A business is not Real Estate. Its value is not tangible and a small difference in characteristics may very well be the deciding factor for the closing of a sale, or may produce a significant change in the price.
It is never enough in a business sale to bring Buyer and Seller together and do a little bit of work in bridging price differences for a transaction to be completed. We have to work with Seller and Buyer in order to bring about a mutually beneficial agreement based on partnership considerations. If we were to get paid by Buyer, as well as the Seller, we would be in a position of potential conflict of interest. In essence we would be transaction brokers, with no fiduciary responsibility to either party. In this case we would be obliged by our code of ethics do disclose to both Buyer and Seller our agreement with the respective counterparty.
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