How does a buyer agent work? Do you pay them separately to work for you or at closing, is the fee a %?

Asked by Carolann Young, 27012 Wed May 13, 2009

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Len Montgome…, Agent, High Point, NC
Wed May 13, 2009
Hi Carolann,

In NC, all agents work for the seller by default, either as an agent or sub-agent of the seller. However, the buyer may have their own representation and work out the compensation with the agent/agent's firm. In most cases, the agent will be paid at closing from the seller's proceeds. In this case it does not cost you anything to have an agent represent you. And this is the most common way. But with the number of foreclosures, pre-foreclosures, and FSBO homes on the market, you cannot assume that will be the case. Sometimes the bank will negotiate the fees of the agent/firm below their companies acceptable fees. In this case, depending on your contract, they may look to you to cover the balance. In the case of FSBO (For Sale By Owner), sometimes the owner is marketing his home on his own because he does not have the cash or the equity to pay agent fees. Here again, depending on your agreement, you would likely be responsible for those fees.

I would recommend two things to you. First, definitely have an agent represent you, even if it means you pay part or all of the fees, especially if this is your first home purchase. The seller's agent is not there to help you! I say this as a Listing And Buyer's agent. Second, interview several agents to find someone you are comfortable with, that connects with your vision of the home you are looking to purchase. When I interview with a potential client, i am looking to see if I can fit their needs and connect with them. If I can't answer yes to both of these assertions, I refer them to someone else.

If you decide to interview a few agents, I would welcome the opportunity to speak with you. You can reach me threough my website below. You will alo find alot of FREE reports there for you to look over to help guide your purchase as well. GOOD LUCK!!

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Rachel, , Winston Salem, NC
Wed May 13, 2009
so here's a scenario for you to use as example.. when a house is listed they negotiate the commision.. so say they decide on 6%.. the listing agent would list the house on mls and as buyers agent compensation they would put 3%.. so in that scenario the listing agent is taking 3% and then the other 3% is going to the buyers agent.. sooo it is paid by the seller at closing.. you get all the benefits of representation and your not footing the bill.. if you would decide to use the listing agent the whole 6% would go to them.. and since they represent the seller first.. all kinds of wackiness could insue.. This is just a general example..commissions are completely negotiable.. but the jist is.. have someone on your side that you like and trust.. and your bound to have a much better experience.. Good luck.. !!
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Chris Mabry…, , Tucson, AZ
Wed May 13, 2009
A buyer's agent will assist the buyer in locating a home, negotiating the offer and inspections, coordinating the escrow period, and hopefully much, much more. Typically speaking, a buyer's agent's commission is paid by the seller or builder at closing. Sellers and builders offer what is called a "co-op" to buyer's agents in order to give them incentive to bring qualified buyers to their house. As the buyer, you usually don't pay your agent anything, but sometimes there are small administrative fees. It differs depending on your location and the company you work with. Also, their compensation is "usually" 3% of the gross selling price. But, commissions are never set in stone and can also differ depending on the specific situation.
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