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With the Internet becoming accepted as buyers' destination in real estate, the discount Realtor is move forward in the front line. The question is, is this really a good thing for consumers? How Is a Buyer Agent Commission Amount Determined? To start with, who determines on the buyer's agent compensation? Is the buyer's agent compensation determined by the amount presented in the MLS Listing? Absolutely not. Many people believe it is, but the buyer agent commission is definitely not settled on by the amount a seller is willing to contribute toward a buyer's agent pay. The recompense a buyer's agent receives (at least in Texas) is resolved entirely between the buyer and the agent he hires, as ordered 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 stipulated in the agreement that buyer pays the agent a particular amount, not the MLS Listing. The buyer accedes to the 3% pay for our job done as agreed upon on the Buyer Rep Agreement. We will receive that amount for our services regardless of the amount offered in the MLS listing, and this is explained to each buyer we work with. The charge amount is first asked for from the seller usually a closed deal but if the seller gives less than 3% through the MLS Listing, the buyer is obligated to pay the disparity if not decides to pursue 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 met 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. We wrote up the offer to include the 0.5% gap in paragraph 12 of the sales contract, where the seller assumes payment in some of the buyer's finishing cost to which the seller acceded. The buyer was going to pick another home if the seller had not consented. So in this case, the seller gave 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 gap and the seller didn't actually "save" anything by offering a 2.5%. Do Realtors Avoid Listings That Pay Less Than 3%? I find absurd the claim that agents will avoid of the discount brokers' listing by consumer groups and others. I don't see how they can. When a buyer signs up with us, or any other Austin Realtor, we have the ability to assemble an Internet search portal that notifies the buyer via email each day of new listings that go with that buyer's requirement. Every buyer gets this same service from us but cannot say percentages other agents in Austin carry out the same, but it is an invaluable tool for us and our buyers as provided for of the MLS System with no extra cost. Search engines do not recognize the commission amounts presented on particular catalog. Buyers will see ALL listings that fit their search parameters. To say that Realtors evade or blacklist listings that give less than 3% is pure crap. 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 consider to be considered good buys. That is all I have time for now but look into part 2 of How Discount Realtors Work.
Article Source: http://www.realestateinvestmentarticles.net
This article was drafted by Chandler Smith, a top real estate professional in the San Marcos Texas area. He maintains San Marcos Real Estate Appraiser as well as Home Appraisal in San Marcos
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