Real Estate Agent Commissions
When looking to buy a house, a real estate agent can be very helpful. You may be wondering how commissions work and how it impacts your home purchase.
Real Estate Agent Commissions | The Basics
Commissions are important to real estate agents. After all, it is only through commissions that they are paid. You will likely be told the percentage of commission that the real estate agent will receive in the name of disclosure, but there are some facts that your realtor may not divulge. First, the commission agreed upon for the transaction may be paid by either the buyer or the seller; this depends on whom the real estate agent is representing. If you hired the real estate agent to help you find the home of your dreams, it is likely that you will be the one paying the commission.
Real Estate Agent Commissions | Percentages
In some instances, the real estate agent represents both the buyer and the seller. If this is the case, it is possible that the commission percentage will be split by the buyer and the seller. To illustrate, if the commission were set at 6%, then the buyer and seller would each pay 3%. Some states and real estate commissions frown upon a real estate agent or broker representing both the buyer and the seller at the same time, however, as this can create an ethical problem. Buying a house includes negotiations on the price as well as repairs that may need to be done before the sale is completed. If the real estate agent is representing both you and the seller, for whose best interest is the real estate agent really advocating?
Real Estate Agent Commissions | Negotiate
Your real estate agent may be willing to negotiate her or his commission rate. This is something that your agent may not be willing to tell you. If you have the exact house in mind and an offer that you know will not be refused, the real estate agent may be willing to lower the commission, as it will not take her or him as long to complete the transaction process.
If you have any further questions about commissions, please call Real Estate lawyer Randy Gugino today for a free consultation.