Question regarding Realtors who offer rebates...

Asked by Jj, Naperville, IL Fri Feb 10, 2012


Just wanted some information regarding real estate agents that offer rebates to their clients and how it works. I've been seeing a lot of advertising for this (i.e. Redfin, etc.), and wanted to get some additional information and some second opinions on how this works, etc. I've also gotten some feedback that if an agent gives you a rebate, they won't be doing a complete job for you. Is this true?

Thanks for any info you can provide.

Help the community by answering this question:

+ web reference
Web reference:


Terry Farnsw…, Agent, Lisle, IL
Fri Feb 10, 2012
This question will probably generate various responses from agents/brokers with various business models. In Illinois, rebating a portion of an agent's commission to a client is perfectly legal. The laws vary on whether licensed agents can rebate commission in various states however - so you might get differing answers depending on where the agent is from.

The notion that an agent that “rebates commission = subpar customer service” or is less experienced is completely false. Some agents will use the "you get what you pay for" argument, but this is simply a scare tactic to try and convince you that by using an agent that rebates you are automatically doing yourself a disservice. The truth is - many agents do not truly keep 100% of what they earn. Out of their commission, most pay desk fees, brokerage fees, advertising fees, etc. Depending on their model, some actually only keep 75-80% (and sometimes less) of what they are paid by the cooperating brokerage.

In the interest of full disclosure, I work for a company that allows me to keep 100% of what I earn, minus a small fee (under $500) per transaction. Other than that, I pay an additional $40 per month, for desk/processing fees. My company doesn’t have the additional expenses that other brokerages choose to take on to generate extra business for their agents, like TV advertisements. I also have minimal support, no “floor time”, etc……I have the freedom (and challenge) of having to truly generate almost ALL of my own business. Since my brokerage fees are minimal, I do offer my clients a small rebate as a thank you - however this amount is much less than what most other agents pay their brokers per month. My point is, generally ALL agents will "rebate" or forsake a portion of their commission. The question is - are they giving it to you........or to their broker.

At the end of the day - rebate or no rebate - the most important thing is to choose a full service agent that you trust, and that has the competence and experience to get the job done. Hope that helps!
1 vote
George Mered…, Agent, Naperville, IL
Fri Feb 10, 2012
Ridiculous. Most of these answers are right on! You get what you pay for in this world. An agent that I know is "in bed" with redfin and reduces commissions for those leads and I wouldn't let this guy be in charge of my goldfish no less buying or selling a home for me. Deal with a professional that will do a complete and thorough job of handling your needs throughout the home buying or selling process.

Good luck and call me or any one of the capable agents that have answered your question.
0 votes
Ken Tracy, Agent, Naperville, IL
Fri Feb 10, 2012
Hi JJ. Interesting question. I honestly don't know how it works. I know I don't give any money back. I work to hard for too little money already! :)
Good luck whatever you decide to do!
0 votes
David Field, Agent, Naperville, IL
Fri Feb 10, 2012
Rebates are legal in the state of Illinois.

JJ, my service platform is second to none and includes personal showings, negotiation strategies, inspection consultation, etc. I have a rolodex full of service contacts to help you through the process...inspectors, attorneys, contractors, etc.

My service platform for my Home Buyer Program is very competitive, send me an email and I will respond with details. In addition, I exhibit local market expertise and am located in Naperville, IL.

David Field
Managing Broker/Owner
0 votes
Roland Vinya…, Agent, Sprakers, NY
Fri Feb 10, 2012
I was always told that rebates were "kickbacks" and thus were illegal in our State. Remember, you often get what you pay for.
0 votes
Don Maclary, Agent, Virginia Beach, VA
Fri Feb 10, 2012
I would be very carefull about rebates! Check your local Real Estate Laws first:)
0 votes
John Wilt, Agent, Wheaton, IL
Fri Feb 10, 2012
Be careful. Many of these 'rebate' companies make you sign an agency agreement that sometimes states if you buy a place from any Realtor 'other than' the agent assigned to you, you may still owe THEM a commission. In addition, many of the rebate companies have you view the properties yourself via open houses etc. That is, they don't show the properties with/to you. So, you are left trying to view the homes yourself. If they do not take the time to show you the place and/or may have a contract that states you are going to pay them if you buy through someone else, what incentive do they have to make sure you are not buying a lemon or getting ripped off? I am not saying either is Redfin's policy. You just need to be sure. Read the fine print of any agreement. Finally, some Realtors claim they only work with buyers who have signed agency agreements with the Realtor (ie that you promise to use them only). The fact is, any Realtor that is confident in their sales and negotiating skills AND comes across as looking out for their client's best interest usually will not ask you to sign any agreement. However, if you are using multiple agents you risk the good agents dumping you. Find a qualified agent you are comfortable with and use them to look for a property. If you discover they are withholding information, not showing properties you want to see (assuming they are available to see) or, are in any way not looking out for your best interests, dump them. There are plenty of great agents in the Naperville area. Call me if you need anything.
Web Reference:
0 votes
Laurie Chris…, Agent, Oak Park, IL
Fri Feb 10, 2012
You should research exactly how these companies work. One I recently dealt with sent a different agent out with the buyers each time so not one of them knew all of the details of the deal, which in my opinion was a disservice to the clients. You would probably be more successful finding an experienced buyers agent (ABR) in the area you're thinking of buying and putting them to work negotiating a great deal for you. You'll end up saving well more than the rebate offered by some others.
0 votes
Laura Feghali, Agent, Stamford, CT
Fri Feb 10, 2012
Hello Jj,
Offering a rebate to buyers is just one of the tools agents use to attract buyers to work with them.
It does not necessarily mean that the agents are discounting their services but it's only a means to help them grow their business.

Good luck to you!

Laura Feghali
Prudential Connecticut Realty
0 votes
Anthony Cava…, Agent, Jolier, IL
Fri Feb 10, 2012

I have heard arguments on both sides of the issue. Some agents offer rebates to get business, while the agents that don't feel that offering rebates lowers the value of their profession, and they give arguments to support that notion.

Rebates are usually given to you at closing. Some percentage of the agent's commission is given to the buyer as a credit on the HUD-1, which is the accounting sheet detailing all money entering and leaving the transaction. Essentially, it reduces the amount of money you need to bring to closing. This is usually done by written agreement.

On that note, whatever rebate Redfin is offering you on their website, I'll beat it. Give me a call or email me today so we can talk about it and about your needs.

Anthony Cavalea
Managing Broker, Able Realty
0 votes
Search Advice
Ask our community a question
Home Buying in Naperville Zip Codes

Email me when…

Learn more