Recently I have approached one owner to rent out his unit, the prospect has viewed the house. Owner wants to prepare the tenancy agreement by his own and ask for 1k tenancy agreement fee. He doesn't want to deal with my property agency and request to meet up again with the tenant to collect cash in full, owner claim he will pay commission after few days when tenancy agreement has been signed. Owner speaks with high authority. In this scenario, what would you do? 

@knyap 

Have never heard of owner charging for preparing the tenancy agreement, while engaging an agent. For charging this fee, is the owner a lawyer?

It sounds to me that the owner wants to get a discount on the commission fees, RM1k discount to be exact.

@knyap get the owner to sign undertaking letter for the payment of comm

@knyap I have an owner who did the tenancy agreement as he is a lawyer. However he did not charge the tenant and he did not short change me on the commission. I agree with Shawn , get owner to sign the the professional fess undertaking letter.

The tenant also has a right to agree or dont agree on the fees charged to him. He may choose to engage his own lawyer or ask the agent to prepare the agreement which may cost him less.

@shawncss 

May i know, how does the  undertaking letter works?

@domng undertaking letter is acting as a legally binding document, the owner will undertake to pay the comm to agent upon completion of the deal. If the owner failed to do so, then the agent can bring this matter to the court. 

How's the tenant response?

@knyap 

Advisable  not to allow the Landlord or Tenant to perpare own Tenancy as there will always be a tendency to favour himself (one-sided) esp. in the covenants clauses or any other major clauses...things like landlord asking 1 year rental upfront /ridiculous deposits cos of some racial  profiling ...tenant moving in  early without paying for that part of occupation...before commencement  ... and many more . I will always insist that it is done by agency  fair to both parties and less headache...and sleep better as u may not know what 'extras' he has added into the agreement

Where the Agency Fee is concern refer to the appointment letter.

As TA is concern Landlord have the right to prepare the TA. But also refer to TA what is stated regarding TA.

@wilymn3 

That is the reason... we need a person who is not the tenant or owner to prepare the TA, in order to minimize conflict of interest. Ofcourse, we need to practice due diligence, and understand every clauses before we sign the TA.

@shawncss undertaking letter doesn't carry much weight. There is a standard form from agency which you can give the owner to sign to commit to the commission. it is not worth going to court if the rental is not much. It would cost you at least RM500/ to get a lawyer to issue a demand letter.

@renachang the owner told me he don't want to deal with my attached agency, he wants to deal with me personally. He don't want to sign any form. He wants to collect full deposit, he wants to draft the tenancy agreement himself. He said once tenancy agreement has been signed and key has been handover, then only he's paying me the commission.

KN Yap, I have a feeling that the owner will not pay your commission.

@knyap 

Maybe the owner does not want to pay the GST on the commission? That is why he does not want to deal with your agency.

@knyap the signs are there. It is so obvious that he has no intention to pay you. Any owners were to say this to me I rather not do the deal then to get nothing out of it.

@renachang In fact undertaking letter carry too much weight, more like an overkill, as it is enforceable in the court, only that the cost for legal proceeding might be higher than the damages awarded by the judge. The effect of signing it is to give the warning to owner that he must honour the commission otherwise he can be sued in court and almost for sure he will lose the case.

@knyap good sharing