Marketplace terms say the fee is owed on closing regardless of who sourced the buyer
I've been reading notes and paper for months and mostly staying out of equity deals, but a friend on the wholesale side asked me to look at the terms of a marketplace he's about to list two contracts on, and one clause has me stuck.
The fee section says the platform is owed 3 percent of gross contract price on any property listed on the platform that closes within 120 days of listing, regardless of the source of the ultimate purchaser. There's a separate exclusivity paragraph saying the seller won't market the property through any competing marketplace during the listing period, defined as 45 days with automatic 45 day extensions unless written notice is given at least 10 days before expiry.
So on a contract at 168k, that's 5,040 to the platform. His expected assignment fee is 12k, so the platform takes 42 percent of his spread even if his own buyer, someone he has closed four deals with, is the one who funds. And the auto-extension means the fee tail keeps rolling unless he calendars the notice date every 45 days.
He reads this as standard and says everyone signs it. I read it as a clause that only makes sense if the platform genuinely brings buyers he can't reach, and he already has 30 buyers he can reach.
What I can't tell is whether 3 percent of gross with a source-blind trigger is actually the market convention here, or whether he should be asking for a carve-out for named existing buyers. He wants to list Monday.