Everyone wants to know how Buyer’s Agents get paid. Here’s the truth.
The buyer is the only party to the transaction that brings a check to the closing table. So, simply, the buyer pays the fee. In most cases, the buyer’s agent fee is “baked” into the sale of the house. It’s the whole enchilada.
How Buyer Representation Works: When you hire a Realtor to represent you in the purchase of a home you sign a contract with the Realtor’s agency that outlines the terms, conditions, and most importantly the fee that is due to the Buyer’s Agent. This contract is between you and your Buyer’s Agent. The seller does not pay the Buyer’s Agent fee, it is paid through the transaction as a line item on the seller’s settlement statement.
Here are the two ways to pay your Buyer’s Agent:
In most cases the purchaser may request that the seller cover the Buyer’s Agent fee in the transaction. This means that when you see a “sale price” for a house it does not reflect the “net proceeds” to the seller.
Less commonly, the purchaser may want to pay the Buyer’s Agent fee directly to the buyer’s agency as part of their closing costs. This means that the “sale price” for the house does not have the Buyer’s Agent fee baked into the transaction.
If you are thinking about buying and still have questions - please feel free to reach out, we are always happy to help!