New Construction and Cutting Corners

Get a Commission Refund

Large Builders like Lennar, D.R. Horton, Pulte, M/I Homes, Robert Thomas

Important: Register me as your “buyer’s agent” when you begin talking to your builder so that I can capture the commission for you. If you do not do this, I may not be able to help you save money on the commission.

I will provide you with legal representation throughout the new construction process.


My fee is 1% of the base price of the home and it is only payable if I am succesful in collecting the commission from the builder. Most builders are paying at least 2.7% to buyer brokers and some offer a secret bonus on top of that.

Examples: Get Back $12,200

$600,000 base price on new construction home. My fee is $6.000 if I collect the commission. The builder pays me $16,200 plus a $2,000 bonus. You get a commission refund of $12,200.

If the builder is not offering a bonus, you would get back $10,200 in the above example.

If the builder is offering a flat fee of $12,000, you would get back $6,000.


Most builders offer hidden commissions of 2-3% to buyers’ Realtors. At the first meeting you must register me as your agent or I will not be able to get the commission for you. And no, they will not offer you a discount if you choose to work directly with the builder (no Realtor). In fact, if you try to negotiate directly with the builder, you will forfeit the commission to the builder and I will not be able to get it for you. My fees are only payable if I collect the commission for you. By using me, you will save a lot of money and have the benefit of having an attorney help you with the entire process. Most of my new construction clients get commission refunds of over $8,000 – and that’s after they paid me for my legal services.

Commission Rebate vs Commission Refund

When a Realtor pays a commission rebate to a consumer, it is construed to be a discount on their commission. They are actually sharing part of the commission paid to them by listing brokers. I believe it is unethical to keep money by the seller’s broker secretly to me. I get paid legal fees, not commissions. So when I receive a commission I construe that money to be unearned fees and I deposit in my trust account. Once it clears my trust account, I refund it to my clients less my legal fees. I am refunding the commission. I am not paying a commission rebate.

Tax Implications? I Don’t Think So.

Ask, and I will send you an IRS letter that seems to indicate that commission rebates are not taxable income. I am not a tax attorney and am not qualified to advise you on this.

Rebates are Illegal. That’s a Lie

If an agent tells you that commission rebates or refunds are illegal, they are lying to you and should be reported to the Minnesota Department of Commerce. Minnesota Statute 82.70 COMPENSATION is clear on the matter and it says that commissions can be shared, “between a licensed real estate broker or salesperson and the parties to the transaction;” You can find the statute here

Smaller and Custom Builders

There can be a lot of pitfalls working with small and customer builders and my services are typically far more involved. In these cases my commission refund is typically more than 50% of the commission I receive.

Builder Purchase Agreements

Most builder construction agreements are extremely complex and one-sided and expose consumers to terrible risks and liability. While many builders often refuse to negotiate these contracts, I still should be able to help.

Whether you are using MI Homes (click here for reviews), Lennar Homes (click here for reviews), D.R. Horton (click here for reviews), Pulte Homes (click here for reviews), Hanson Builders (click here for reviews) or Gonyea Homes (click here for reviews) you need to be cautious and you should have an attorney on your side. Give me a call and let’s set up a meeting to properly set your expectations and prepare you for the process.

Pitfalls of New Construction

Here are a few of the many issues I see with new construction:

  • Delays of 6 months or more.
  • Interest rates cannot be locked in until 60 days prior to closing. Buyers this year may not be able to qualify for the loans they initially did qualify for at the beginning of the process.
  • Substitution of materials and selections.
  • Supply chain issues.
  • Builder insolvency. Many builders over-committed prior to supply chain issues.
  • Unpaid Subcontractors and mechanics liens
  • Undesirable site modifications.