Q: I am looking for a Buyer’s Agent and wonder if the agent is paid typically by the Buyer or the Listing/Seller?
- Curious in Guntersville
A: A Buyers Agent can be compensated in many ways. Typically, compensation to the Buyer Broker is agreed upon in the Listing Agreement and then offered via the Multiple Listing Service. The commission is usually paid to the Buyer Broker by the Closing company (Title, Lawyer, etc.) from the Seller’s side of the transaction, so then the Seller has agreed to pay the commission.
But – a Buyers Broker (the Agent is paid by the Broker usually) can also be employed and compensated by the Buyer depending on the representation agreement and state/local laws. Often when a Buyer uses a Buyer Broker to purchase a For Sale By Owner property, the Buyer will directly compensate their Broker.
It is more what is typically done, than how it should/must be done. Compensation from the Buyer Broker to the Buyers Agent (designated Agent or otherwise) is then between the Broker and the Agent.
Maya Paveza is a Realtor with Coldwell Banker in Wilmington, DE.
A: If a seller under his/her listing agreement is offering an incentive commission to a buyer’s agent, than the commission will be paid by the seller at the closing. If you sign an agreement with your buyer broker that has a larger commission than is offered any particular seller or no commission at all to a buyer’s agent, than you will make up the difference.
Ralph Windschuh is a Realtor® with Century 21 Princeton Properties in Ronkonkoma, NY.
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