Can I get out of paying my management company 3.5% of the sale of my home when I sell it to the tenants?
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Can I get out of paying my management company 3.5% of the sale of my home when I sell it to the tenants?
I have a contract with my property management company in Wisconsin that states they get 3.5% of the sale price of my home if their tenant buys it. I was under the impression that they got that by acting as the buyers agent. Turns out that is not true. They just get it for the tenant buying the house. I now have to pay 9.5% to sell my house to the current tenants. I would like to wait until the lease ends at the end of April and sign the tenants to a month to month lease with me directly and then sell them the house. My concern is that I am opening myself up to a lawsuit by knowingly trying to circumvent the contract.
Asked on March 23, 2012 under Real Estate Law, Wisconsin
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
If the contract plainly states that they get 3.5% if their tenant buys the home, you have to pay them that amount--if the clause is ambiguous, you could perhaps try to argue that is not the only interpretation, but if it is unambiguous, you will have to comply. Whether you would be liable if you waited until the expiration of the lease depends on the language of the contract--does the contract indicate that it only applies if the tenant purchases while the property management company is managing the property, or does it apply if a tenant of theirs ever buys the property? If unsure of how to interpret the contract, consult with an attorney, who can review the contract with you. The actual terms of the contract will control.
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