We recently signed a sale agreement with a real estate agency and agreed on a marketing plan and its cost. The very next day, my wife and I both started receiving emails, texts, and phone calls from a Sydney-based company called Campaign Flow, offering to finance our marketing costs. WTF? Where did these guys come from — we’re a long way from Sydney and had no need for campaign finance.
We contacted the real estate agency, told them we were unimpressed, and asked them to call off the “loan sharks.” They explained that the marketing had to be paid in full before they’d list our property. Fine, we said — send us an invoice and your bank account details. They then explained we had to pay Campaign Flow regardless, even without needing finance, and that Campaign Flow would forward the money back to the real estate agent, who would only then list the property. WTF #2. Headshake.
We reluctantly paid the financing company, who pushed us toward financing at every step. For example, when you open the web portal to pay, you’re given three options: 1) Finance, 2) Pay in Full, or 3) Credit Card. Take a guess at which option is highlighted in green with a pre-filled tick next to it — yes, correct, option 1. You’re also warned that choosing option 2 or 3 could delay the launch of your campaign, and option 3 carries a surcharge. We paid in full with option 2, and we’re still waiting for our listing to go live.
I find this practice offensive. I can see the value for someone who genuinely needs finance. But when I looked at their real claimed APR — 14% — it appeared to assume the house takes six months to sell. So if your house sells in six weeks, are you effectively paying something like 60% APR? That sounds like a lot. Any bean counters on this thread who can confirm the maths?
Maybe this is standard practice these days and I’ve just been living in a cave. Time to get with the times?
We are well outside NSW and I believe this is an Australia-wide thing that is becoming popular with Agents, maybe they get rewarded with a “Conference” or other such junket.
I guess it could be beneficial to the Agent specifically for those who can’t afford to pay upfront, as the Agent is not carrying the marketing costs until the settlement so ker-ching more profit.
The Agreement and Marketing Price List makes no mention of Campaign Flow. The agreement states Marketing is to be paid upfront to the AGENT which we were happy to do then we were forced to use a third party, who delayed our listing and presumably the third party now has all our private identification information in just another database waiting to be hacked.
My guess is real estate agents are pushing non-payment of advertising fees onto the seller. While traditionally costs associated with selling come off the sale proceeds, there are cases when a property doesn’t sell and there aren’t sale proceeds as security against the costs of selling. Hence services like Campaign Flow being used to secure the advertising costs of a property.
However, if one is willing to pay upfront for advertising, why should Campaign Flow be used as the intermediary. Such costs a seller significantly more, and isn’t in the interests of the sellers as a result. Why do real estate agents insist on using them? The website reveals all as they give kickbacks (commissions) to the agents when they are used…within 4 hours of payment rather than waiting until the property is sold or if the agent is able to recover advertising costs if not sold (the later two could be many months away). This is why it is used and agents that do, think sellers are their money pot. I personally would shop around for another agent.
Edit: The other thing of concern is if the agent didn’t tell you that they engaged Campaign Flow on your behalf as their payment agent. This is totally unacceptable.
