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20181001 Change of mind, how? Part 2

20181001 (Mon)

What if my potential tenant changed his mind? What would happen to the booking fee? And, commission? Part 2.

For example, potential tenant (T) is renting your principal’s house (P). Appointment stated that the commission is 1 month rental. T paid RM1,000 booking fee which is equivalent to 1 month rental. However, a few days later, T changed his mind as he saw another better house. The booking fee of RM1,000 is forfeited. The amount claimable by the agency is 50% of the booking fee or commission whichever is the lower. In this case, RM1,000 x 50% = RM500. Commission of 1 month in this case happens to be the booking fee. So, there is no difference.

However, if it is RM2,500 booking fee (2 months deposit + 0.5 month utility deposit), and the tenant forfeited this deposit, what is the claimable fee? 50% of RM2,500?

Wrong. The claimable portion is 50% of the commission or booking fee WHICHEVER IS THE LOWER.

The commission is 1 month rental. So, it is RM1,000 x 50% = RM500. NOT RM2,500 x 50% = RM1,250! The remaining deposit of RM2,000 (RM2,500 – RM500) is forfeited to the landlord.

However, if the Tenant has paid all the required money – deposits and rental, signed the tenancy agreement and upon taking vacant possession refuse to rent then, it is a completed tenancy. Full commission is to be claimable. It is like when a bowl of laksa is served on the table yet you do NOT want to eat it. The laksa is wasted.

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