Commission Question?

Question

When an agent representing a buyer closes a contract where does his commission come from? Is there a fee charged to the client? Is the commission split with the sellers agent?

Answer 1

The commission is actually due from the buyer, since the buyer contracted with the agent to represent his/her interests. In practicality, however, the commission comes from the seller.
If the seller is represented by an agent, the buyer agent may agree to the commission split offered by the listing agent. If the seller is unrepresented, it may come from the seller in the form of a reduced offering price on the property. In that case, the buyer benefits from the reduced offering price and pays the buyer agent directly.

Answer 2

The commission is usually paid by the seller for both sides, hence 6% or more. If there is a co op buyers agent, then it commission is generally split 4 ways 45/55 each side for the most part and to make the math easy. So the listing agent would get 45% of the listing side, and 55% would go to that broker. Same with the other side. Each broker and agent negotiate that breakdown. The homeowner negotiated the upfront commission with the listing agent.

I am not aware of any fee's charged to the client, and I assume you mean the buyer, unless the buyer's agent and the buyer have a written agreement between them for the buyer to pay a commission to the buyers agent.

Now I guess it's possible, the such an arrangement could be made, then the buyer's agent would also get a commission from the listing agent as well. But I would believe it would have to be disclosed to all parties. Everything dealing with monies in a real estate transactions between the actual parties, has to be disclosed.

Answer 3

Typically when a home is listed, it is determined how much will be paid to the buyer's agent from the listing commission.

So, to answer your question... it typically comes from the seller, through the listing contract.

However, a buyer's agent may want to charge a professional fee or an "administrative fee" directly to the buyer. For that, it would be an amount due at closing.

I hope this clarifies things for you!

Answer 4

If the home is listed with the agent he will be contracted with the seller at a certain commission. He will then split that with a buyers agent as a fee for bringing the buyer to purchase the home. So technically the seller pays it.

Answer 5

It's been a long time since I
was in the real estate game, but here's how I remember it.
The brokers for both the seller
agent and the buyer agent get
5% commission each. Out of
this 5%, they pay the salesman (agent) 3%.(These commissions are paid on the
actual selling price of the home.)
When the buyer makes an
OFFER to the Seller, all this
is in the SMALL PRINT.
If the sale is made, the house goes into ESCROW,
where all the financial details
are made. Escrow pays the
RE agencies. So who actually pays off these commissions. The buyer pays out of the home's sale and the seller pays out of his
new loan that covers the sale.
These % have probably gone up in the last 40 years so they
will be higher I'm sure.

Answer 6

The seller pays the commission and the commission is split with the seller's agent.