What is the buyer agent commission? How does that work?

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The buyer’s broker commission or sometimes called buyer agent commission is the money a seller agrees to pay the broker representing the buyer as an inducement for other brokers to show and sell the home (by law, brokers earn the money and pay their agents. Agents do not get paid directly, hence the confusion between broker and agent). typically, the commission payable is a percentage of the selling price advertised in the agents’ information section of the listing in MLS. We state restrictions or other incentives in the private remarks section of the listing agreement.

No matter what broker lists your home over 90% of the time another broker will sell your home. The typical fee in our Texas market is 3%. There is not a set commission rate paid to the buyers’ broker. With all commissions, we negotiate the amount paid when you enter a listing agreement not when you have an offer. The amount of buyer’s broker commission offered is part of the selling strategy determined by the seller.

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Sometimes we will see a 4% buyers commissions offered and other bonus terms to induce buyer agents. Agents will show your home if you offer a reasonable commission. Agents may try harder to show your home if offered more compensation.

The title company pays the buyer broker commission at closing to the buyer’s broker. The broker pays the agent all or part of the commission.

Notice: This website contains general information about legal and financial matters. The information is not advice, and should not be treated as such. You must not rely on the information on this website as an alternative to legal or financial advice from your attorney, accountant or other professional services provider. If you have any specific questions about any legal and financial matter you should consult your attorney, accountant or other professional services provider.