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I have an issue with the Realtor on a HUD offer for a foreclosure.?

Here are the Facts: A realtor submitted an offer for me to purchase a HUD foreclosure. I won the bid. I submitted the contract and earnest money. I am now informed that I did not win the bid, based on the realtor not submitting the request for their commission. It is being suggested that " I " pay 3% to cover for this error, so they get paid. They are really trying to push my sympathy buttons to agree to this, which i refuse to do. Do I not have a binding contract at this point ( contract & earnest money paid)? Any advice or suggestions? My understanding is that the commission comes from seller, not the buyer, but due to the bureaucracy of HUD, they just lost out.

Public Comments

1. Technically, you have won the bid and can close on the house. The Realtor made a mistake and did not put a commission on the contract for himself - that might be why you won the bid - your NET to HUD is higher because of this. Talk to his broker. Tell him he can close on this house, and not get paid or sabotage the deal and have you complain to the state real estate commission (the agency that regulates Realtors in your state. At any rate, tell him that you will not work with him after this and so he's not getting a commission off of you anyhow. If he closes on it, he's still "your Realtor" and can still hope to get referrals. It might be too late already - here is the order that things happen on HUD houses. 1 You submit your bid - though you do the paperwork, the bid is submitted on the internet. 2 On the bid opening date (the day after bids are due) - your Realtor gets an email saying that your bid was best. 3 He needs to overnight the package (contract, lender letter and photocopy of cashier's check) to the HUD manager. 4 As long as all the paperwork is correct, HUD signs the contract and sends it back to your Realtor (this might be 4 or 5 days after the bid due date. 5 Your Realtor has three working days to get the earnest money check (cashier's check) to the closing agent. If any of these things are not done in a timely manner, HUD will cancel the contract and either place the house back on the market or offer it to the second person in line. The Realtor's commission is paid by the seller, out of the proceeds of the sale on most HUD transactions - but it does lower the net to HUD of that offer. If you offer $98k and no Realtor commission, you beat an offer of $100k and 3% commission. The one type of transaction that the buyer actually pays the Realtor's commission is on the Good Neighbor Next Door houses. Correct paperwork must be done to make the commission a buyer's expense, just like a survey or appraisal or origination fee is considered a buyer's expense. On the GNND houses, the commission does NOT change the net to HUD. These buyers get the house for half price and win by a lottery system, not highest net to HUD.
2. THEY lost their commission, you should not have lost anything. Your bid was accepted by HUD, HUD is not going to screw you. If your agent continues to tell you that HUD is not going to sell you this house call HUD and pitch a fit. I will help you find the number if you need it. Personally I would call the state RE board too and tell them your broker is trying to force you to pay money you did not contract to pay, after the deal was struck with the seller. This is your agents problem, and they are totally screwed if they think they can pass this on to you. Do not feel sympathy. This is their job, they screwed it up, not you. Your wallet should not be effected by their incompetency.