EXCLUSIVE: Senator's husband's firm cashes in on crisis

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By Chuck Neubauer

Six percent commission is a standard rate for residential property in the private sector, but some experts said many buyers negotiate a lower fee.

Ms. Kenner, who deals in foreclosed residential properties, said she charges 5 percent to 6 percent, depending on the market, adding that she shares the fee with the buyer's agent and often with the asset management company.

Mr. Shaw said incentive fees are not that frequent in the private sector, but when he sees them they are usually smaller than 2 percent and pegged for a specific market.

The FDIC defended the fees, saying they were "intended to incentivize the contractors to sell the assets as quickly as possible for the benefit of the FDIC and to protect the insurance fund."

"The private sector normally does not have an urgency to sell assets quickly and thus do not normally have any incentive to do so," the agency said.

Mr. Shaw disagreed and said his private sector clients - banks and loan servicers - also wanted their properties sold quickly.

CBRE has the chance to collect the largest percentage of the sales price for properties worth $25,000 or less, under a flat fee agreement far more generous than the private sector.

Under the FDIC contract, CBRE charges a $5,000 sales commission for each property and can collect an additional $2,500 incentive fee if they sell it in under six months. In other words, they can collect as much as $7,500 on the sale of a property worth $25,000 or less - which works out to a sales commission of 30 percent or more.

Ms. Kenner said she charges $2,000 to $2,500 to sell properties worth $25,000 or less. Another firm, Prescient Inc., which won a similar FDIC contract at the same time as CBRE, charges a $1,948 commission and a $485 incentive fee.

"I think it is a little egregious," Mr. Shaw said of the CBRE compensation deal for small properties.