Home Buying in Brooklyn>Question Details

Penny, Home Buyer in Brooklyn, NY

What are the typical fees for a buyer's rep and is that usually paid by the buyer or seller?

Asked by Penny, Brooklyn, NY Sun Sep 23, 2007

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The answers below are true, but there can also be a fee charged by a buyers agent. It can be a set fee
( $500), or a percentage of the sale of the home the buyer purchases. These fees are discussed with the buyer before they embark on their search for a home and a buyers agreement should be signed.
1 vote Thank Flag Link Sun Sep 23, 2007
Penny in Brookly you do not pay a buyers agent, and if one tries to charge you a fee, please leave him and go to another firm. That agents fee will come from the commission split he or she will get from the sales agent which is already included in the selling price.
0 votes Thank Flag Link Wed May 21, 2008
We Jeannine Dyer and Associates do not charge a buyers fee. Commission comes from the sellers however, we do expect loyalty from our clients. At the time of meeting, we will discuss what you expect of us and what we expect of you. We will provide to you a package that will encompass all the details so you will know what to do and what to expect. Please call me and lets get acquainted. 440 341-9100
0 votes Thank Flag Link Tue Apr 29, 2008
The brokerage fees are typically paid out of the seller's proceeds. This means that unless there is an administrative fee, or some unusual arrangement, you will not be paying a commission to your agent.
0 votes Thank Flag Link Mon Sep 24, 2007
Buyer agents are most often compensated from the seller proceeds at the time of closing. While the payment comes from the proceeds, the minimum fee that a buyer agent will be paid can be determined by a negotiated agreement between the buyer and the buyer agent.

It is in the buyers best interest to discuss buyer agent fees and expected services with the buyer agent. Do you want the buyer agent to contact FSBO’s and other unlisted properties? It is wrong for a buyer agent to select properties to be shown based upon the offer of compensation as represented in the MLS, and allow a buyer to believe they are being shown all properties that meet the buyer specifications.

A buyer agent or the broker for which they work might determine his/her minimum fee for buyer representation. If you, as buyer, execute an agreement to that effect, your buyer agent will then show you all properties in the MLS and FSBO properties. Once you locate a property for purchase, the seller offered compensation would first pay the buyer agent. If there were no seller offered compensation, or it were less than the agreed upon minimum, the fee could be built into the offer made and still paid at closing from the seller proceeds. You can also pay your buyers agent by making payment to the buyer brokerage company directly.

If you decline to execute a buyer agent agreement, the buyer agent should show you all properties in MLS that meet your criteria, unless they clearly communicate their minimum fee structure and provide you full disclosure that they will only be showing you properties within that range. A buyer agent cannot be forced to work for low compensation, so a buyer agent does have the right to decline showing you properties beneath that threshold........but you, as buyer, must be informed.

There are buyer agents who will favor the property listings that offer stronger compensation, so it is in your best interest as a buyer to have a buyer agency agreement. While a Realtor should not favor listings because they have a higher compensation, the buyer agent agreement you execute substantially eliminates that possibility. The same agreement also outlines the terms and expectations of service, which is to your benefit.

The value that the right buyer agent brings to the table may protect you and save you thousands of dollars. The results of that contract on the same property may still be more financially advantageous than if you had used a different agent who was not as skilled or knowledgeable.
0 votes Thank Flag Link Mon Sep 24, 2007
Deborah Madey, Real Estate Pro in Brick, NJ
MVP'08
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Hi Jean!
Good luck to you in your home buying adventure! There are so many exciting times around the corner...

Please do find a reputable buyer's agent - someone a friend, colleague, or family member can wholeheartedly endorse. Don't stop there though. Make sure you interview the agent and have a good chat. Make sure you two can communicate freely and there is a definite feeling of trust - both ways!

Typically the seller has a contract with the listing agent that will compensate the buyer's agent a percentage of the sales commission at the closing of the deal.

A discussion on actual overall fees should be incorporated into your interviews with potential buyer's agent - right off the bat. Clear the air - get your buyer's agreement contract clarified and any additional fee's that may be charged will be written out. In otherwords, no surprises.

Much luck to you & don't forget to enjoy the process!
0 votes Thank Flag Link Mon Sep 24, 2007
Hi Jean,

When a seller lists with an agent, he negotiates with that agent a total commission that will be paid from the seller's proceeds at the closing of the sale.

During the signing of the listing agreement, the listing agent and the seller also agree how much of that commission will be split with the buyer's agent. It is typically 50% of the total commission, but some sellers like to offer a special incentive to buyer's agents and will offer additional commission to be allotted to the buyer's agent.

The buyer rarely pays his agent directly, unless it is a FSBO home and the owner does not wish to compensate the buyer's agent. At that time the buyer may wish to offer his agent compensation at closing for their services, but it is not required.
0 votes Thank Flag Link Sun Sep 23, 2007
The commission for the buyer's agent is typically paid by the seller unless you buy from a FSBO (for sale by owner). Commissions are negotiable and how much the seller is willing to pay is negotiated up front when the listing agent takes the listing. The seller pays the whole commission to the listing brokerage (not the agent directly) and then the listing brokerage pays the buyer's agent commission to the brokerage for which the buyer's agent works. What the average commission is depends on where you are located. 2.5% - 3% of the purchase price is very common, but it could be more or less.
Web Reference: http://www.go2kw.com
0 votes Thank Flag Link Sun Sep 23, 2007
Ute Ferdig -…, Real Estate Pro in New Castle, DE
MVP'08
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