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With more and more people searching on the Internet for alternative sources for ways to sell their home, the discount Realtor is becoming a larger player in the real estate industry. The question is, is this really of importance for consumers? How Is a Buyer Agent Commission Amount Determined? Let's start with the question of who determines how much a buyer's agent is received. Is the buyer's agent recompense determined by the amount existing in the MLS Listing? Definitely not. Many people think it is, but the buyer agent commission is absolutely not settled on by the amount a seller is willing to contribute toward a buyer's agent fee. The fee a buyer's agent receives (at least in Texas) is resolved entirely between the buyer and the agent he hires, as instructed in a Buyer's Representation Agreement. It is the buyer who assents to pay the buyer's agent a certain amount, not the seller. It is the Buyer Rep Agreement that dictates the buyer agent's compensation amount, not the MLS Listing. In our Buyer Rep Agreement, a buyer accedes to pay us 3% for our assistance as buyer agent. We receive the 3% without considering the MLS listing as made clear to the buyer. The fee amount is first asked for from the seller usually a done-in deal but if the seller gives less than 3% through the MLS Listing, the buyer is obligated to pay the disparity if not opts for a different home. On the flip side, if the seller is offering a buyer agent bonus, or more than 3%, we rebate that to the buyer so that our motivations and advice can never be attributed to a commission amount. So far this year with only one MLS listing out of 30 closed deals where a seller offered a 2.5% commission for the buyer's agent. The seller on that listing offered 2.5% commission. We wrote up the offer to contain the 0.5% difference in paragraph 12 of the sales contract, where the seller assumes payment in some of the buyer's closing cost to which the seller agreed. The buyer was going to get another home if the seller had not consented. So in this case, the seller provided the other 0.5% commission to the buyer, who in turned paid us the 0.5% gap at closing. Our buyer was not out of pocket for the difference and the seller didn't actually "save" anything by offering a 2.5%. Do Realtors Avoid Listings That Pay Less Than 3%? The assertion by consumer groups and others that agents will steer clear the listings of discount brokers is absurd to me. There is nowise the agents can do that. Since we have the expertise to assemble an Internet search portal, any buyer signing up with us or any Austin Realtor gets informed through email each day of new listing matching their need. Every buyer gets this same service from us but cannot say how many other agents in Austin carry out the same, but it is a useful devise for us and our buyers as part and parcel of the MLS System with no added cost. Search portals are not aware of the commission amounts tendered on specific catalog. Buyers can browse listings fit to their requirement. For those who say that Realtors evade or blacklist listings that pay less than 3%, that's garbage. The MLS technology does not allow a way for us to sort out those listings or hide them from the buyer. The buyer sees all listings that are on hand and matching their standard, and they often call us right away when an interesting one pops up new in the system, and we will show buyers any and all listings that they deem to be good candidate properties. That is all I have time for now but look into part 2 of How Discount Realtors Work.
Article Source: http://www.SponsorDirectory.com/Free-Content
This article was drafted by R Chandler Smith, an up and coming real estate professional in the San Marcos area. He manages San Marcos Appraiser as well as San Marcos Home Appraisals
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