6% Commission split between a referring agent, selling agent and listing agent in Michigan

Asked by kmking1978, 49756 Thu Jul 19, 2012

If I Bought A House For $75,000 And We Were Referred To The Selling Agent And There Was A Listing Agent How Much Would Each Receive In Commission If It Were A 6% Commission?

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Tim and Linda…, Agent, MI,
Thu Jul 19, 2012
Often MLS Agencies will have agreement to split the Commission 50-50, with the Listing Agent getting half of the commission, and the Selling Agent getting half of the commission. So in your example if the total commission was $4,500 ($75,000 x 6%), the Listing Company would get $2,250 and the Selling Company would be $2,250. If our company gets a referral for a Buyer Prospect from another Agency, we offer 20% (sometimes 25%) of the Selling Agents commission to the Agency who sends us the lead. So our company would send $450.00 of the Selling Agent commission to the Agency that provided us with the Buyer Lead. Every company has its own policies, so you would have to check with them to see what their policy is concerning this. Tim and Linda Keohane, Cabela's Trophy Property Agents at Great Lakes and Land Real Estate Company 07-19-12
1 vote
Thanks for the info. I am only asking because we bought our original place in 1999 in Lewiston, MI did weekends and vacations there before we permanently moved up in 2008. We knew when the time was right we would move. The opportunity came up that we could do this, we found the house we are in now by going on line and searching, we then sought out a local real estate agent that we knew and you do get to know people when you have been up in the area for 12yrs, and had her take us and look at this house, we liked it put a bid in and got it, we in turn used her to list our home for us in which she did an awesome job. My sister is upset because we could have asked her husband who is new to Realty(2 1/2yrs) for a referral. We didn't need a referral because we knew the area, which he doesn't because he lives downstate. Why would I ask for a referral and take hard earned money that my realtor worked for just because he would have referred us.
Flag Thu Jul 19, 2012
Dan Dougherty, Agent, Onaway, MI
Wed Nov 28, 2012
There is no definitive answer to your question. It would depend on the percentage of commission that was agreed upon between the listing and referring agent, that would be sent back to the referring agent, at the time of the referral. Typically it would range from 20 to 30% of the listing side.
0 votes
Anna M Brocco, Agent, Williston Park, NY
Fri Jul 20, 2012
Why not simply ask your agent the question....
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Read my reply to Tim & Linda Keohane. My sister was mad because we didn't get her husband to give us a referral to an agent even though we have lived in this area permanently since 2008 and had our original place since 1999. Didn't need a referral because we already had friended people here that were in the real estate business.
Flag Fri Jul 20, 2012
Annette Law…, Agent, Palm Harbor, FL
Fri Jul 20, 2012
These are private negotiations between professionals. Without being privy to the contract, there is no way to know the facts. Let me suggest, this 6%, must be shared, disproportionately, with no less that 5 parties if a formal referral situation exists as your question indicates.
0 votes
Carole Higgi…, Agent, Suttons Bay, MI
Fri Jul 20, 2012
There is no set formula either for how much commission is charged or how it is split up-to do so would be called price fixing and a violation of Federal Fair Trade laws. The total amount of commission is derived through negotiation between the seller and their agent and should be based on the amount of work- including advertising, open houses, and negotiation time that will be required to perfect a sale. The portion of that total commission that is offered to co-oping brokers (the buyer's agent aka the selling agent) is also based on an estimate of the amount of labor to bring a specific buyer to the closing table on the subject property.

As for the referral piece there isn;t always a referral involved but if there is it can only be paid to a licensed real estate broker and it is a negotiation between referee and referor. The referral fee is paid by the agent who received the referral. So for example- if I as an agent have a Realtor friend in another state and that Realtor friend has a client who is relocating to my state they might call me and say that want to give me a referral. We would then negotiate what piece of my earned commission I would offer them to send me the person. If they told me the buyer is well qualified, has some source of income or cash to buy the property and has a timeline by which they have to be relocated I might offer a bit more- say 25% of my portion of the commission. On the other hand if my buddy tells me the buyer does't yet have a job in my state, they plan to make multiple trips out to house hunt etc I would most definitely offer less- I would try to offer 15% and probably end up paying 20%. The rationale is buyer number one is motivated and, at least in theory, should not take as long to get the table, Buyer number 2 is going to be more work to get them to purchase a house so I want a bigger piece of the pie because I have to spend more time energy, gas etc to help them.

I hope this helps and makes sense to you
Carole & Greg
0 votes
Karen Paytas, Agent, Clinton Twp, MI
Thu Jul 19, 2012
That information is between the 2 brokerages involved in the transaction. The amount offered to the selling agent is usually listed on the MLS. Also, if there was a referring agent that fee is negotiated between the selling agent and referring agents brokerages.

Good Luck,

Karen Paytas, GRI, CMS
Real Living Kee Realty
0 votes
Shanna Rogers, Agent, Murrieta, CA
Thu Jul 19, 2012
Hi kmking1978,

That would depend on the agreement between all the Agents. You don't need to worry about it - unless you signed an agreement with your Agent to pay them something over and above what the seller is paying.

Shanna Rogers
SR Realty
0 votes
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