Fearless Homebuyer: Buying Your First House the Right Way
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Who Pays for My Buyer’s Agent?
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This is an often misunderstood and confusing part of the home buying process. You get advice and guidance from your Buyer's Agent, but who pays the bill?
Here’s How Buyer’s Agents Get Paid
When a seller wants to sell their home, they call up a real estate agent and agree on a fee. Lets say that amount is 5% of the sale price. Most real estate agents are part of a Multiple Listing Service (MLS) where they agree to compensate the Buyer’s Agent (the agent who represents whoever buys the home.)
When your Buyer’s Agent helps you purchase the home, that 5% total commission is split between the Listing Agent and your Buyer’s Agent (your agent may get 2.5% of the sales price.) Your agent gets compensated through the transaction but only represents you and best of all, you don’t have to pay them out of your own pocket.
The seller’s agent may try to get you to use them, so they’ll get the entire 5% fee and you won’t have your own agent- just say NO!
But wait, doesn’t that mean my Buyer’s Agent will want me to pay more for the home so they’ll make more money?? Let’s look at that for a moment. If you pay $5000 more for a home, your Buyer’s Agent will make an extra $125. I don’t know about you, but I’m not going to risk losing the trust of my client over $125! Choose your Buyer’s Agent wisely and this will never be a concern.
In most states, your Buyer’s Agent is forbidden to disclose anything you don’t want known by a seller or the seller’s agent.
Who Pays for My Buyer's Agent? , 4.7 out of 5 based on 3 ratingsChoose a state from the drop-down menu for specific state information related to this lesson.
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