When you are entering the real estate market as a buyer or a seller, real estate commission is generally on the forefront of a lot of your conversations. This is with your agent or potential agent. Even though the commission really only pops up as a factor at the end of the process when you actually close on a house or on your house.
So while you are aware of commission from the get-go, there are many fine print details. Realities of real estate commission can be overlooked. Then they rear their ugly heads right at the finish line.
Here are some realities of real estate commission to keep in mind before you even find your agent and list your home.
Not all commission is created equal
While you generally pay your agent 5–6% in commission, not all commission works the same way.
One major difference in the real estate market comes from who pays the commission — the buyer or the seller. A seller generally pays the commission to both their agent and the buyers’ agent. Meanwhile, a buyer doesn’t pay a commission at all.
Unless you choose to go “FSBO” or for sale by owner, you will be unlikely to bypass this commission. It is usually how your agent gets paid for their work up to that point.
Sometimes, however, an agent represents both a buyer and a seller in a deal. They may slightly reduce their commission in this case. Finding someone local is helpful in this case. Of course, if you’re selling your home in Miami, beycome is local and here to help you. They help save on commission as much as possible.
Read the fine print in your contract
As mentioned above, an agent doesn’t get paid for their work until you complete the sale of your home or the purchase of your new one.
Read any contract with your agent or potential agent carefully. Many times, even after your contract ends and the agent didn’t recoup a commission, the agreement still states that if you sell your home to a buyer the agent found during the contract term, you owe the agent a commission.
Pay close attention to the fine print in your contracts. Know what you are getting into commission-wise should your home not sell during the terms of your agreement. This is important with an agent.
Conclusion
Also, as far as fees go, pay attention to your contract. Note termination fees and the termination clause in general. If you decide to work with an agent and then change agents, it may not be easy. Your termination clause may state you owe the agent a significant fee if you say goodbye.
Discover:
Even the “typical” agent commission of the real estate agent has some caveats and exceptions. Understanding exactly where your money can and will go during the process of selling or buying a home is critical. This helps save you money. Keeping the above realities of real estate commission in mind will ensure you are smart about your sale.