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With the Internet becoming adopted as buyers' landing-place in real estate, the discount Realtor is thrust in the front line. The question is, is this really an advantage for consumers? How Is a Buyer Agent Commission Amount Determined? To begin with, who determines on the buyer's agent compensation? Is the MLS listing a yardstick with regards to the commission of the buyer's agent? Without a shadow of a doubt, no. Many people think it is, but the buyer agent commission is absolutely not determined by the amount a seller is willing to contribute toward a buyer's agent fee. The recompense a buyer's agent receives (at least in Texas) is concluded 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 instructed in the agreement that buyer compensates the agent a particular amount, not the MLS Listing. The buyer agrees to the 3% pay for our services as mutual consent on the Buyer Rep Agreement. We get the 3% without regardless the MLS listing as made clear to the buyer. We will endeavor to get payment of the charge first from the seller, and have always accomplished in doing so, but if the seller is offering less than 3% to buyer agents via the MLS listing, our buyer will be obligated to pay the discrepancy or go for a another 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. Presently, out of almost 30 closed deals, we've experienced only one listing that our buyer wanted that offered less than a 3% commission to the buyer agent. The seller on that listing offered 2.5% commission. In that incidence, we updated the offer to include the 0.5% gap in paragraph 12 of the sales contract, where the seller assents to pay some of the buyer's closing costs, and the seller agreed. If the seller had not acceded the buyer was ready to take on a different home. The 0.5% variance paid for by the seller afforded the buyer to complete the 3% commission for us. The buyer's capacity to pay the gap was without question nor can the seller save for that 2.5% offer. Do Realtors Avoid Listings That Pay Less Than 3%? I find ridiculous the claim that agents will steer clear of the discount brokers' listing by consumer groups and others. There is nowise the agents can do that. When a buyer signs up with us, or any other Austin Realtor, we have the ability to set up an Internet search portal that notifies the buyer via email each day of new catalog that match that buyer's criteria. We do this for every buyer. I'm not sure what percentages of other agents in Austin do the same, but it's a priceless devise for us and our buyers, and it's provided as part of our MLS system at no extra cost. Search portals are not aware of the commission amounts offered on specific catalog. Buyers will see ALL listings that fit their aptness. To say that Realtors avoid or blacklist listings that give less than 3% is gibberish. The MLS technology inhibits a way for us to filter out those listings or hide them from the buyer. When the buyer gets all listings and new ones that come up in the system about properties that matched their criteria they notify us and in return we show all listings of good candidate material. This is all for now but part 2 of How Discount Realtors Work needs to be looked into.
Article Source: http://www.realestateinvestmentarticles.net
This article was authored by Chandler Smith, a savvy real estate authority in the San Marcos area. He operates San Marcos Texas Appraiser as well as Home Appraisals in San Marcos
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