As of August 17, 2024, Realtors are no longer allowed to share information about what commission is being offered to buyer’s agents through the Multiple Listing Service. A court order from a class action lawsuit in Missouri abolished the sharing of real estate agent fees through the Multiple Listing Service.

This change was meant to help consumers by making the amount of buyer’s agent commission a part of the Offer to Purchase process between the Buyer and the Seller. (In other words, part of the negotiation!)

How are buyer agent fees paid?

Frequently, the buyer’s agent fee can be included in the sale price. In this way, 4 Buyers Real Estate will be paid at closing from the funds being paid by our client (and/or our client’s lender) to the Seller.

There is a line on the Offer to Purchase where our client’s request will go. Some sellers have already decided to pay enough or more in buyer’s agent commissions than what we asked for in our contract. Seller’s agents can tell us if there is an agreement of that kind; seller’s agents are just restricted from using the Multiple Listing Service to share that information.

Including the buyer agent fee in the Offer to Purchase requires the agreement of both the Buyer and the Seller of the particular property. This will be part of the negotiation planning when our client is making an Offer to Purchase.

Offer to purchase

We are not responsible for the actions of the Seller. However, 4 Buyers Real Estate has extensive experience negotiating buyer agent fees with Sellers. Before designated/dual agency became legal (if disclosed) in 2006, exclusive buyer’s agents, like us, needed to add our buyer’s agent fee into an Offer to Purchase. Our commissions needed to be negotiated to avoid additional costs beyond our client’s mortgage. Your exclusive buyer’s agent from 4 Buyers will advise you about best practices to include the buyer agent fee.

In the event that the Seller won’t agree to include the entire buyer’s agent fee within the sale price, our clients will need to pay the remainder due to 4 Buyers Real Estate at closing.

What to negotiate for

During the Offer to Purchase negotiation, the buyer can choose among these options:

  1. Request that a buyer’s agent fee is included in the purchase contract. There is a line on the Offer to Purchase for this purpose.
  2. Request an additional credit to the Buyer from the Seller for closing costs equal to the buyer’s agent fee that is due from the sale price. Note: this must be approved by the mortgage lender. If the Seller agrees and the buyer’s lender permits it, the additional credit can get the entire buyer agent fee included in the mortgaged price of the house or condo. The buyer will pay less at closing, then write a check or transfer the additional fee to our client’s agent.
  3. Pay the remainder of our client’s buyer’s agent fee directly to our client’s agent at closing.

If the Seller has agreed to allot more than the amount due in the 4 Buyers Real Estate contract, our clients can choose from these options, depending on the negotiation position at the time of the Offer to Purchase.

  • On the Offer to Purchase, request the fee that the Seller has offered. Then our clients will be rebated the extra commission from 4 Buyers Real Estate at closing.
  • On the Offer to Purchase, request the fee that is due to 4 Buyers Real Estate, which is less. This makes the net purchase price higher for the Seller, compared to other buyers, who may be asking for a higher commission for their agents. This could create a competitive advantage.

Procedure:

Because we will be paid what is on our contract with our buyer-client, it doesn’t matter to us what the seller is offering. We will find out whenever that is possible. Because, if they are offering more than what we are asking of our clients, we can negotiate to have that overage work for our clients in the negotiations.

At the point of Offer to Purchase, we will plan how to get our fee included in the mortgage (which is what most people want). If that is not important to a particular client, they let us know. We’ll talk about the commission request as part of any offer.