Who Pays the Real Estate Agent’s Commission?
Hiring a real estate agent before you buy or sell a home is non-negotiable. This is because they have the expertise to ensure that you don’t make a deal on the property in question.
But before we talk about why you should hire a real estate agent, let’s answer a question that everyone ponders over at some point in their lives: who pays the real estate agent’s commission?
When you’re buying or selling a house, there are always certain parties involved. These include:
· The seller: The party that’s selling the house and putting it on the market.
· The buyer: The individual who will be purchasing the house from the seller.
· The real estate agents: Both parties will have real estate agents who negotiate the deal on their behalf.
· The broker: Real estate agents either work with an agency, under an individual, or may be their own boss. Either way, a brokerage or real estate company is involved.
Who pays it?
This is where things get complicated. Technically, the buyer is the one paying the commission since they’re the ones making a purchase.
Conversely, it can be argued that the seller also bears the burden of the commission. This is because when pricing the home before the sale, the seller has to calculate the commission and add it to the price.
Thus, the buyer pays the amount, but the seller doesn’t receive the full cost that’s paid for their home, since the commission is deducted from it.
Who receives the commission?
The real estate commission is a percentage of the sale price of a home, and is divided between the two agents. It is usually 5 or 6 percent of the cost of a home. The commission is negotiable and includes the service charges of the real estate agent.
If you’re buying a house, your real estate agent will compile a list of homes, take you on home tours, and make—and negotiate—offers on your behalf. A buyer’s real estate agent will conduct an appraisal of your home to set the price, negotiate the cost of the home, and handle the paperwork.
As a real estate agent, you may find that you receive your commission months after a sale has been made. This can be very frustrating if you’re dealing with cash flow problems. Silver Advance has a reliable and efficient solution to this problem. Without any hidden costs, we give you an advance on your real estate commission, allowing you to reinvest the funds elsewhere.
Contact us to get started on receiving your real estate commission advance.