Home agents get paid

A buyer agent is a professional whom the buyer authorizes to protect and secure the buyer's interest in a real estate transaction. For example, a buyer's attorney can act as a buyer's agent. In simple words, a buyer's agent is an appointed person who will generally owe a statutory duty of trust, confidentiality, and loyalty to the buyer's real estate transactions.

The main advantage of having a buyer's agent is that the buyer will represent your best interest, and the seller will pay the agents to represent you.

So how does the payment system work?

It is important to note that real estate agents have no authority to collect commissions from buyers or sellers directly. Instead, the payment must go through the real estate brokerage that the agent is the member. Therefore, the real estate brokerage will calculate and decide what to pay the real estate agents.

When a listing agent accepts a contract to sell a home, the seller is charged a percentage of the purchase price. It's important to remember that all commissions are negotiable. It is up to the agencies to determine their commission rate. However, to understand how a buyer's agent is compensated, let us assume that the listing agent charges a total commission of 6%.

The listing agent guarantees the seller that they will pay a percentage of the total listing commission to a cooperating broker or an agent out of that commission. Typically, it is half, so in this case, it will be 3 percent. A cooperating broker, in this case, is a non-listing third-party broker that finds a buyer. A cooperating broker can turn out to be a buyer's agent.

Thus far, the listing agent has already promised the seller that the cooperating agent who will bring a buyer to the selling table will get a 0.6 of the deducted commission, so he/she is living by the promise.

Buyer Agency Contract

The buyer's agency contract dictates that you are always responsible for your agent fee. You will be required to allow your agent to request payment of not less than a certain percentage.


The bottom-line of the matter is, 99.9% of all sellers will pay your buyer agent, and on an infrequent occasion will the buyer pay. That is now by choice. Note that Nothing in the buyer's contract with the seller can alter the seller's pre-existing agreement with the listing agent.

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