typically 2.5% in the Chicagoland area.
In my experience, the game of "commission limbo" (aka "how low can you go") winds up serving no one long term. There'll always be someone willing to "do it" for less. The more important questions have to do with exactly what the agent will do (and the "we'll help you buy your house" answer doesn't cut it!) and how much the fee is for those things.
You have to consider what you want from your agent...how much representation, how much "availability", what tools and resources do you want from them, etc. And, unless you are paying the agent up front, or are paying a hefty retainer, remember, COMMISSION PAID AT CLOSING (in other words, no closing means they get paid NOTHING AT ALL!!!) HAS TO BE HIGH ENOUGH for the agent to be willing to incur the risk of not getting paid anything at all.
When buyers and sellers alike are willing to pay for real estate expertise and services up front or over time (rather than after a specific event has taken place...ie the CLOSING of a real estate buy or sale), they'll have to pay a premium. It's simply deferred risk.
Just wanted to offer one more point. Jeff mentioned that he's an EBA (Exclusive Buyer's Agent) which means he represents only buyers, never sellers. The majority of agents around the country, and certainly in Illinois, represent sellers and buyers, both, generally not in the same transaction however (which brings up a host of different issues, beginning with FULL disclosure of the ramifications). While I do understand the logic, in theory, of EBAs, I'm also convinced there is no "perfect" system. One of the advantages of working with an agent who also represents sellers in transactions is that you, as a buyer, get an insight into how they "think" and respond. That certainly helps in negotiations. Also, if you also happen to be a buyer who has a property to sell, the EBA who helps you purchase cannot help you sell (they would refer you to another agent...collect a referral fee for that referral...and THAT agent would be your listing agent). Certainly, most EBAs would never require you to use "their" referred agent...you'd be free to pick your own.
My point here is simple. I have friends around the country who are EBA's...I greatly respect them professionally, and I respect what they are trying to accomplish. However, particularly in states like Illinois where buyers are FULLY represented (with FULL FIDUCIARY RESPONSIBILITIES) by the agent they choose (which is still not the case in some states around the country that still honor the old "seller sub-agency" practice), the bottom line is that you, as a buyer, should interview several agents. Find out what they will to "represent" you in your home search and purchase process, what might be required of you to get that representation, and select ONE agent in whom you have confidence and trust. Most agents (EBAs as well as "traditionals") do their utmost to get their "fee" paid out of the transaction itself, as Jeff mentioned, through the "unilateral offer of compensation" offered through the MLS by the listing broker. And as I pointed out in an early response to your inquiry, here in the Chicagoland area, the majority of those offers are 2.5% of the purchase price.
Point of information: When a buyer works with an agent, is represented by the agent, is educated by the agent, is serviced by the agent, that agent has a right to be paid! Though that MAY be through the offer in the MLS, that's not necessarily the case. What if there is a property NOT in MLS...a "by owner" property, for example. Would you want your agent to assist you in such a purchase...to provide you with "comparables" as well as to review and analyze those comparables with you to determine what you want to offer...then to negotiate ON YOUR BEHALF with the seller (most sellers, despite what they MAY TELL YOU AS A BUYER, are more than willing to PAY A BUYER'S AGENT'S FEE for a quality buyer and a smoother transaction). Can't tell you how many times I've been paid through the transaction while representing buyers when purchasing FSBO properties...even when the seller had SPECIFICALLY TOLD MY BUYER THEY WOULD NOT PAY A COMMISSION! They often say that to intimidate the buyer's agent into not trying to collect a fee.
Now to your question, I typically receive 2.5% of the sales price per an agreement with the listing agent. The MLS is basically a system that listing agents use to offer compensation to buyer agents (called cooperative compensation) and also a nice tool for home searching. This arrangement creates a conflict of interest for buyer and a buyer agent, since I make more if you buy more, but the conflict is a small one since I would only make a little extra by pressuring you into a higher price . This conflict can be eliminated by an alternative payment arrangement. For example, we could agree on a set fee in advance in lieu of commission (then the commission could be rebated to you at closing). This is not very popular so it is not done often. There are a million other ways to handle compensation but none of them are used often, I hope that helps.
In Illinois, we operate under what is called a "Designated Agency" system. Basically, that means that the "broker" (ie. Coldwell Banker, RE/MAX, C-21, etc.) "designates" an agent to work with the consumer (in reality, the consumer selects their agent and the agent is considered to be "designated" by the broker...what a way to make a simple process complicated! LOL!) At any rate, in our system, an agent is "presumed" to be representing the party with whom they are working (be it a buyer or a seller) unless otherwise disclosed IN WRITING.
If you're a buyer, and you select an agent to help you, that agent is SUPPOSED TO REPRESENT YOU. However, how aggressively they work for you, how diligent an effort they make on your behalf, the level of research they do for you can vary CONSIDERABLY. How much it varies will depend to a great degree on what kind of arrangement you have with the agent. The "default" arrangement is that if they help you find a home and help you negotiate, then troubleshoot, the transaction, they will be paid BASED ON THE OFFER OF CO-BROKE COMPENSATION which the listing agent publishes in the MLS. In our area, the MAJORITY of listings show 2.5%...but there are also many which show more than that, and a lot which offer less (I've even seen some offering $1 or $100.
Knowing that, the question becomes "how hard would you be willing to work to provide the best service you can when you know the possibility exists you effectively won't be paid?" Also, add to the mix that there are plenty of Builders out there who require that the agent accompany a buyer ON THEIR VERY FIRST VISIT to the new construction (most agents are happy to do so...it's just that sometimes buyers "forget" and drop in to the new construction because 'they were in the area and liked what they saw"...basically eliminating the possibility of their agent receiving compensation for their work and counsel) or how about all those properties with unrepresented sellers (FSBOs) who by and large ARE WILLING TO COMPENSATE A BUYER'S AGENT through the proceeds at closing (even if they tell YOU they won't...I can tell you I've sold a lot of FSBOs...some of whom had told my buyer they would not pay...but they DID in fact agree to pay me IN WRITING).
An agent representing a buyer is extremely vulnerable when they operate without a written agreement and understanding. Whether the agent is an EBA (Exclusive Buyer's Agent....which generally means they don't represent any sellers) or simply an Agent representing a buyer is of little significance here in Illinois because of how our agency laws are structured. But whether you select an EBA or you select any agent to represent you, IT IS UP TO YOU AND YOUR AGENT TO DETERMINE WHAT COMPENSATION ARRANGEMENT IS AGREEABLE TO YOU BOTH. Should you enter into an agreement to work exclusively with a particular agent (and I DEFINITELY advise this is in your best interest...find one agent you like, have confidence in, trust to work in your best interest) and be LOYAL to that agent...they'll work much harder for you if they know they have your loyalty) that agreement should spell out who pays the agent, how much the compensation is, and the circumstances under which the agent will have "earned" their compensation. It should also have a specified time limit...just like a listing agreement with a seller does.