Commissions and Splits
As a Real Estate Agent, I often get asked how I am being compensated. Real Estate Agents get paid through a transaction at the end of each sale. This is known as commission. Real Estate Agents are not paid an hourly wage or salary.
In other words, if a Real Estate Agent works with a buyer to find and purchase a home for several months, they do not get paid for their time spent if there is no settlement (aka “Closing”) at the end of the transaction, or if the transaction falls through. Real Estate Agents only get paid if the transaction goes through Closing.
The commission amount is negotiated, in most cases, between the seller and their listing agent. Typically, this is 6% of the sale price. The listing agent then determines the split with the buyer’s agent. Some brokerages have commission discounts for the sellers with whom they work.
The point is that a real estate agent’s commission does not come from the buyer. The overall commission is paid for at Closing by the seller. The fee is taken from the seller’s proceeds of the home or property. From there, the commission is split between the seller’s brokerage and the buyer’s brokerage firms according to the negotiated split.
For more information on Real Estate Agent Compensation, call me today at 984-355-9703. You can also drop me a line at VanessaKbroker@gmail.com. I’d love to hear from you.