What's very interesting is that many people don't understand how real estate agents get paid. I'll break it down in the simplest terms.
There are two main types of real estate agents: buyers agents(BA) and listing agents(LA).
The Listing Agent is the one who you go to when it's time to sell your house. He (or she) is the one who markets the home, gets the home exposed and noticed and helps negotiate the terms on the sellers behalf when offers are presented. This is also the agent that determines and negotiates with the seller as to how much money from the sale price is going to go to the Real estate agent/s. The agent will typically negotiate a percentage of the sale price however occasionally you'll find agents who work for flat fees.
Here's a link to mysellers program if you're interested in what I can do for you.
Assuming it's a percentage, that percentage is divided, with a portion going to the listing agent and a portion going to the agent who brings a ready and willing buyer to the table. So if the seller negotiated a 6% total commission, more than likely 3% would go to the listing agent and 3% would go to the buyers agent. However, the portion that goes to each is entirely dependent on what the seller negotiates with the listing agent. It could always be 2% to the LA and 4% to the BA!
Now you might think that because the listing agent is the one doing all of the marketing, they'll also be the one to find a ready and willing buyer for the property, however in most instances, this isn't the case. Because, there are so many agents already out there working with buyers, it's often another agent who brings a ready and willing buyer to the table.
This is called the buyers agentor sometimes called "selling agent" and he (or she) is one who is working with a buyer who is purchasing a home. The buyers agents' role is significantly different from that of a listing agent in that instead of marketing a property and so on, they're facilitating the entire process of getting a buyer into a home. This involves showing properties to their buyer, facilitating in the financing process if it's needed, facilitating the closing in escrow and also assisting in negotiations on the buyers behalf.
The great part about being a buyer is that you never have to pay a commission to work with a Real estate agent. Despite the fact you're working directly with and representing the buyer, it's always the seller who's paying you because you presented a ready and willing buyer to them. That's right, if you're a buyer, you get agent representation for free. Sweet, huh? Here's a breakdown of what you can expect from me in terms ofbuying property in Whatcom County.
Can an Agent represent both the buyer and seller?
Yes, in the State of Washington (and in most states), there's a type of agency called "duel agency" where the agent represents both the buyer and
the seller. With a Duel Agency, it must be disclosed to and signed off on by both buyer and seller prior to getting into any agreement. You'd think it be sweet and highlyincentivizingfor an agent to do this and 'double end' a deal however it can be very tricky especially when it comes to an agents'fiduciary duties he owes to anyone he represents as well as thenegotiation process. This is why even if a listing agent has a buyer, he'll often have another agent represent that buyer( for a piece of the pie of course), as to make sure both parties have full representation in the purchasing process.
And then, once all deeds and documents are signed and recorded by thenecessary parties, the escrow office provides each agent theircommission check. And this ladies and gentlemen is how real estate agents get paid.
