Cindy, the typical commission to a buyer's agent is 2-3% of the home's seling price and you would receive 25% of whatever that amount is, as allowed by the seller's conditions of sale. The commission is always stated in the Multiple Listing Service on each property so you will know what that is, prior to viewing a property or making an offer. Obviously a seller offering a higher commission has an advantage to you. There are many other financial factors that weigh into a home's purchase, such as repair costs, your ability to obtain financing, and closing costs, all which vary depending on who you work with. For example, if you choose to work with me on a $200K home and we can use the closing agent I recommend, you will have no closing cost settlement fee, a potential savings of $300-$800. But, some banks and other instututional owners (foreclosed properties) have their own required settlement agent and you'll be subject to their fees which will not be negotiable. Again, a good buyer's agent will explain all this to you once you commit to him/her and begin your shopping experience. Once you begin shopping you may decide not to look at homes that have high repair costs, a low commission, and dictated settlement fees by the seller, because those homes would "eat up your cash" more quickly than non-foreclosed homes from conventional sellers with traditional options that can keep your out-of-pocket expenses to a minimum. In most cases, buyers needing financing for a purchase have limited funds available and therefore more limited choices than buyers who can just pay cash for the property. And remember: in the Akron-Canton-Cleveland market there are over 500 professional buyers - seasoned investors- who are looking for exactly the same deal you are, and they can spot the best deals and snap them up immediately - often the same day as they come on the market - and they are "ready to buy" with either financing in place or none needed, and no contingencies for inspections; in other words these buyers may grab the property you want before you can even see it and they write a quick, clean, all-cash (non-financed) offer to the seller that the seller gladly accepts even if the offer is a low offer, because the accepted offer gets the property "off the books" of the foreclosing lender quickly. With respect to the 25% rebate, I am able to offer this because I do much Internet marketing and have little in the way of overhead costs, unlike larger brokerages who often have buildings, staff, training costs for new agents, and steep advertising expenses that require them to receive a certain level of compensation in order to stay in business. Some of the larger brokerages have "commission minimums" that might prevent one of their agents from showing you homes below a certain minimum price or commission. Most of the larger brokerages also have fees they charge to their buyers (averaging $150-$200 locally) but by comparison I do not charge any fees. From a buyer's perspective, working with a larger brokerage has few advantages so long as you can find an experienced agent elsewhere. I am going to trust by the nature of your questions that you do not have the experience of a professional buyer but if you work with a good agent, you will approach the market successfully and have a better chance of winning against your competition. You will also gain some experience, so that should you decide to become a profesional investor, you'll have some basic tools to begin a profitable experience.
Thanks - Don French