Rental Basics in Naperville>Question Details

Abigail Buss…, Home Buyer in Oak Park, IL

Question about the process of how an agent gets paid on a rental.

Asked by Abigail Bussard, Oak Park, IL Mon Sep 10, 2012

I have a question regarding how an agent gets paid when they rent a home. I'd like to rent my house out - and an agent told me that it's 1 month's rent to do it. How does this work? Do they keep one of the checks for 1st month rent/security? Or, are these checks written out to me, and then I pay the agent directly? Or, do I pay the brokerage? Just trying to figure out what is typical and how exactly all the parties involved get paid. Thanks

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tenant pays first month rent in advance and one month deposit made out to owner and in my office, you write a check to CB for one month. No longer is it advisable to cut two separate checks, one to brokerage and one to landlord. After the checks clear, tenant agent gets paid
0 votes Thank Flag Link Mon Jan 6, 2014
Ally, the direct answer to your question is that both checks would be made out to you. You in turn would issue a check for the agreed amount for services rendered to the listing Broker not to the listing agent directly. How can I help?
0 votes Thank Flag Link Mon Sep 10, 2012
Hi Ally,

In addition to the comments below, talk with your tax accountant. Depending on how you set things up, I'm pretty sure the check you write back to the listing agency can be deducted as an expense.

Best,
Michele
0 votes Thank Flag Link Mon Sep 10, 2012
Hello Ally,

thanks for using tulia to get answers to your questions.

the agent will collected 2 certified checks, one for security deposit and one for first month rent, he give those to you and you then give them a certified ck for services, this will be paid to the listing broker which will take care of paying their agent and anyother agent whos is involved in the transaction.

Beest Regards,
Inaas
0 votes Thank Flag Link Mon Sep 10, 2012
The security deposit by law must go directly to you. That agent's company will have a policy for how they get paid. Some allow the renter to pay the company directly (1st month's rent check) and others require that the owner pay it directly. Your agent should be able to answer this.
0 votes Thank Flag Link Mon Sep 10, 2012
Thanks - I guess my question is........who does the renter make the checks for the 1st month's rent and security deposit out to. If I agree to pay one months rent - does the renter make that 1st months rent check out to my agents company? Or to me, and then I write a check to the agent's company.

Does the security deposit go to me or the agents company? Thanks!
0 votes Thank Flag Link Mon Sep 10, 2012
If you are paying one month's rent as a commission fee to your agent, the agent gives the check to their company (brokerage); the broker takes his/her share, the agent gets his/her share and the rest is given to the renting company to be split with the agent who found the renter.
0 votes Thank Flag Link Mon Sep 10, 2012
Hi Ally, each agent / company has their own policies, and there is no "standard" commission rate. You should make sure that whoever you hire is proficient at getting homes rented quickly - ask about their tenant screening processes as these can vary from agent to agent as well. I would ask the agent you already spoke to to clarify their policies and procedures, and then decide if they're the right person for the job. Best of luck to you.
0 votes Thank Flag Link Mon Sep 10, 2012
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