I’m interested in hiring a real estate salesperson who is offering a rebate for working with them. How do I know I will be guaranteed the rebate?

In an active market, salespersons and brokers looking to stand out may offer rebates and other incentives to entice prospective buyers and sellers to work with them. Ontario real estate professionals are allowed to use this type of sales promotion, which can provide savings to the client. If you want to work with a salesperson because the rebate they are offering is appealing, there are a few things you should consider before committing.

Under the regulations that brokers and salespeople have to follow, they must treat everyone they deal with while trading real estate fairly and honestly, and they must be responsible in their financial commitments. In other words, if they make a commitment or agreement having to do with their business, they must live up to it.

First, the real estate professional must clarify the details of the rebate. Will it come to you through the brokerage after closing, or can you expect the payment to be presented to you by your representative, after they’ve been paid by their brokerage? Having a clear understanding of how and when the rebate will be paid to you could avoid a misunderstanding or conflict later on.

Second, if a real estate professional makes you a promise, you can expect to receive the details in writing. When a rebate is agreed upon in a signed, written document, it could be included as part of your representation agreement with your salesperson or broker, or it could be a separate document altogether.

Either way, before you sign anything, you should read and thoroughly understand it, and ask your representative to any questions that you may have. If you aren’t sure about an agreement you are entering into, seek independent legal advice.

If you ultimately sign the agreement, that paper trail will document the rebate and serve as a reference for verifying the terms.

Even with everything in writing, disagreements can arise. If you can’t resolve the dispute with your representative, then the next step is their broker of record. The broker of record is in charge of making sure the brokerage’s employees comply with provincial legislation and the brokerage policies, so they should be receptive if you contact them about one of their staff. It’s also important to remember that your representation agreement is with the brokerage, and not your individual representative.

So if you have the paperwork with the details of the agreement, the broker of record may be able to help solve the issue.

If the issue is not fixed after speaking with the broker of record, or you are still unsatisfied with the outcome, then RECO wants to hear about it. Last month I outlined how RECO can help you settle disputes with your real estate representative, and you can read all about our process and possible outcomes here. I’d like to reiterate that while RECO regularly sanctions real estate professionals for breaching the rules, we cannot obtain financial compensation for buyers and sellers, in most cases.

In some cases, once we assess the circumstances and evidence, a complaint may be appropriate for dispute resolution. This is a method that is sometimes referred to as “mediation” and it’s a great way to focus on resolving the problem through mutual agreement between the parties involved.

Depending on the circumstances, when we receive a complaint, we also may take steps to discipline or sanction the salesperson or brokerage.

One last note about rebates: the cheapest deal isn’t necessarily the best deal. A rebate might seem tempting, but it’s always smart to meet with several real estate professionals before hiring one. Ultimately, you should be comfortable with your representative’s experience and services – not just their rebate offer.

If you have a question for Joe about the home buying or selling process, please e-mail askjoe@reco.on.ca.


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