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Buyer Pays Own Agent

Buyer Agent Compensation Incentive

0% Paid to Buyers Agents/Co-op MLS Agents

NOTE:  Although it is most common for real estate brokers to insist that Sellers pay for Buyer representation, it is not legally required, and many sellers pay only for their own representation (similar to a party to litigation not having to pay for the other parties attorney, unless required by law).  There are many advantages to having the Buyer pay for their own agent:

Advantages:

     *  A Seller can attempt to save money by not paying for the cost of a buyer's agent, or reduce the price to make home more attractive (when required to pay for a Buyers agent commission, most sellers pad that cost into the price).

     *  A Buyer can save thousands by paying for their agent outside the transaction by lower mortgage and tax payments (Sellers typically build the cost of paying for a buyer's agent into the price, and when not required, it allows more flexibility between buyer and seller in negotiations).

Disadvantages:

    *  Some agents may be reluctant to show the property if they have to get paid by their buyer, although they risk losing the buyer to the listing agent.

    *  Some lesser skilled buyer agents may have difficulty negotiating their fee witht he buyer as they are used to sellers paying their fee.

Why a lower Co-op incentive can cost you money

Hundreds of agents working on commission-only will be available to try and sell your home. They are all trying to maximize the highest return in the shortest time period, so they tend to look very carefully at what percentage is being offered them to sell a home. Larger percentages tend to get them more motivated to take buyers to see your home. Reducing the economic incentive for them to sell your home may end up costing you far more than you save.

EXAMPLE: If there were 2 cars to wash and you could only wash one of them, would you do the one that paid $20, or the one that paid $40? You likely would not choose the one that paid just $20 unless it was the only one available. And if you agreed to do it, you may not like it and not do the same job or do any extras like you might on the higher paying job.

The very same concept is at work in real estate commission sales. By offering a higher incentive to agents, your home will possibly sell much quicker and for far more than the amount you are paying "extra".