how does real estate commission work

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How real estate commission works Real estate commissions arenegotiable between the listing agent and their client. Many charge certain percentages of their sales prices,where some list a home for flat fees. Real estate brokerages share and cooperate commissions with other brokerage companies.

People also ask


  • How are real estate agents commissions determined?

  • The contracts buyers and sellers have with their agents determine the agents’ commissions. The real estate fee is often split evenly between the buyer and seller agents, although a contract could stipulate that one agent receives more of the commission than the other.

  • How long does a real estate agent’s commission last?

  • All of the details about a real estate agent’s commission (and any transaction fees the agent charges) should be outlined in the contract that you sign when you hire an agent. This is typically referred to as a listing agreement, and it also specifies how long the agent will represent you. (Generally, listing agreements last 90 to 120 days.)

  • How are commissions paid to brokers?

  • Commissions are always paid directly to the brokerage company. Real estate agents have written agreements with their companies that spell out how much they get paid out of the total commission. Some brokerage companies split the commission 50%/50% with their agents. Some agents receive 60% and their company gets 40%.

  • Who pays the commission when selling a house?

  • The seller typically pays the total commission at the close of sale. As a result, sellers will often factor in the amount of money they’ll lose to commission when they calculate their asking price for a home, and keep the cost of commission in mind during negotiations.

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