What Is Procuring Cause In Real Estate And Why Is It Important?

Are you a real estate agent or someone looking to buy or sell a property? Then, you’ve probably heard the term “procuring cause” thrown around. But what exactly is it, and why does it matter? Procuring cause refers to the person who initiates an uninterrupted chain of events that ultimately leads to a successful real estate transaction. In simpler terms, it’s the individual who sets everything in motion and makes things happen. Understanding procuring cause is crucial because it helps determine who gets paid commission and avoids disputes between agents over who deserves credit for closing a deal. In this blog post, we’ll delve into what procuring cause means in real estate and why every buyer, seller, and agent should be familiar with this critical concept. So buckle up and let’s get started!

What is procuring cause?

When it comes to real estate, the procuring cause is the original motivation that leads a buyer or seller to enter into a transaction. In other words, it’s the reason why someone decides to buy or sell a property.

There are many different factors that can contribute to the procuring cause, such as an advertisement, a referral from a friend or family member, or even just an open house sign that caught the person’s attention. Regardless of what causes someone to initially consider buying or selling a property, the most important factor is that they ultimately follow through with the transaction.

The procuring cause is important because it helps determine who deserves credit for the sale. In most cases, the credit will go to the real estate agent who was directly responsible for bringing the buyer and seller together. However, if there are multiple agents involved in the sale, then the procuring cause can become more complicated.

In order to determine who deserves credit for the sale, agents will often look at things like who had contact with the buyer first, who showed them properties, and who helped them negotiate a final price. By understanding all of these factors, agents can better determine who was responsible for getting the deal done and properly credit them for their efforts.

The different types of procuring cause

There are three different types of procuring cause: causation-in-fact, proximate causation, and substantial performance. Causation-in-fact is the but-for test, which asks whether the buyer would have found and purchased the property without the agent’s help. Proximate causation is a legal determination that looks at whether the agent was reasonably instrumental in causing the sale to occur. Substantial performance is a contract law concept that looks at whether the agent did everything that was required under the listing agreement or buyer’s broker agreement.

Why is procuring cause important?

As a real estate agent, it’s important to understand what procuring cause is and how it can affect your business. Procuring cause is defined as the uninterrupted series of causal events that result in the successful procurement of a consumer. In other words, it’s the chain of events that leads from the initial contact with a potential customer to the successful closing of a deal.

There are a few reasons why procuring cause is so important. First, if you’re working with a buyer or seller who has been contacted by another agent, you’ll need to be able to prove that you were the procuring cause in order to get paid. Second, understanding procuring cause can help you avoid making ethical breaches in your business dealings. And finally, if you’re ever involved in a commission dispute, having a clear understanding of procuring cause can help you win your case.

How to determine procuring cause

As a real estate agent, it’s important that you understand what procuring cause is and how to determine it. Procuring cause is the legal concept that determines who is entitled to a commission when a sale is made. It’s based on the idea that the agent who did the most to bring about the sale should be compensated for their efforts.

To determine procuring cause, you’ll need to look at all of the circumstances leading up to the sale. This includes things like who first introduced the buyer to the property, who helped them negotiate the purchase price, and who provided them with information and assistance throughout the process. The goal is to identify which agent was most instrumental in bringing about the sale.

If you’re still not sure who procured the sale, you can always ask the buyer themselves. They’ll usually be able to tell you who they worked with most closely and who was most helpful in making their purchase.

Conclusion

In conclusion, procuring cause is a concept that helps to determine who should be compensated for participating in a real estate transaction. It ensures that agents and brokers are rewarded for their efforts in helping buyers find the perfect property and it also protects them from being taken advantage of by unethical parties. Understanding what procuring cause is and why it’s important can help both buyers and sellers when they enter into real estate transactions. By familiarizing yourself with this concept, you can ensure that everyone involved gets the compensation they deserve.