Brokerage Fee Explained
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Our Company Listings: See our contracted BBC
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Questions or Concerns: Free phone consultation. Cell or TEXT 801-372-1658.
Lynn Fillmore, Principal Broker. Licensed Since 1992' Always Available
Brokerage Fee / Realtor Incentives to MLS Member Agents
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Under our MLS Plans, Realtor Incentives (Buyer Agent Commission, the "BAC") is at Sellers Discretion. Brokerage Fee (Realtor Incentives) is not required to list Sellers property over MLS system, But it is recommended to match or exceed your competition. The purpose of the Multiple Listing Service (the "MLS") is to market properties to Licensed Member Agents and their Clients. Exposure to the general public is an added bonus.
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Licensed Brokers and Agents who represent a Buyer are directed by the Utah Division of Real Estate to have a signed "Buyer Broker Agreement" with their Buyer Client, noting a specific amount of incentive that the Buyer Brokerage charges for Buyer Agent Services. In-House sales (see: Limited Agency) are legal and authorized in the State of Utah. We offer Limited Agency Representation to In-House Buyers as a savings to Buyer and Seller on the cost of sale.
The Utah Real Estate Purchase Contract (the "REPC") notes in Section 5: CONFIRMATION OF AGENCY DISCLOSURE. Buyer and Seller acknowledge prior written receipt of agency disclosure provided by their respective agent that has disclosed the agency relationships confirmed below. At the signing of the REPC:
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Historically, the Buyer Agent is looking for a Buyer Agent Commission (the "BAC") of 3%*, most likely this 3% amount is noted on the required Buyer Broker Agreement. 2.5% has become acceptable to most Agents in our experience. Offering a comparable incentive will avoid this issue in the process. The Choice is Yours.
This "BAC" is the inducement to the Buyer Agent to bring a Buyer to your property and represent the Buyer. ​
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The "SAC" Seller Agent Commission is the incentive to your List Agent to focus on your property with marketing and services above and beyond Utah's Minimum level service rules.
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Throughout the term of your Listing, You may modify this incentive structure as with the other items as desired.
Depending on whether the Buyer Agent is in the lead role or if the Buyer is directing the Buyer Agent; The "BAC" may effect whether the listed property is viewed at all. A low or non-existing Realtor incentive may cause some Buyer Agents to breach their fiduciary duty and simply skip the property. ​
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The Brokerage Fee must be accounted for at Settlement by escrow instructions to the Title Company. For an Unrepresented Buyer or "In House Sale" the overall cost of sale may be reduced by Company.
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*Real Estate Commissions are negotiable and are not established by law.
With all inquiries. We need to identify if the buyer already has an Agent. If they do; Great. The Buyer Agent should then be present at showings. If Buyer indicates that they do not have a Buyer Agent we inform the Buyer of the advantage of our "in-house sale" service, with a reduction in fees involved in any upcoming transaction. The lower cost of sale betters their offer. As Seller, You are not required to participate in a our In-House Sale Service
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Note: Buyers or Buyer Agents may be difficult to deal with or may not want to deal directly with the Seller. Our Full Service and Traditional Service, put us on the front line. The additional cost for this added Broker involvement in the selling process goes a long way. We negotiate contracts every day. Experience is our best value. Our Goal is to avoid problems, wasted time and transactions that do not close.
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8/17/2024 Based on Legal action against Real Estate Brokerages in the Midwest, including the National Association of Realtors, a settlement has been made with the Department of Justice, which has caused changes to be made to the Realtor incentive structure. The Buyer Broker Commission incentives, if any, contracted with Seller and offered by the Listing Brokerage to Buyer Brokerages are no longer viewable on MLS Systems. MLS Contracts, Addendums, Forms and Agreements have been updated by the Utah Association of Realtors. Buyer Brokerages will inquire of Listing Brokerages, if incentives are being offered, by the Listing Brokerage. Sellers may see requests by Buyers, in the Purchase Agreement, for their Buyer Agent's Compensation to be part of the transaction.
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SEE UTAH REAL ESTATE PURCHASE CONTRACT EFFECTIVE DECEMBER 4, 2024
4. PRORATIONS / ASSESSMENTS / OTHER PAYMENT OBLIGATIONS
4.3 Fees/Costs/Payment Obligations.
(e) Real Estate Brokerage Compensation. Seller and Buyer agree that Seller shall contribute ____ % of the Purchase Price to Buyer's Brokerage or $ ______
to Buyer's Brokerage, if applicable ("Seller's Compensation Contribution"). If no amount is entered, then Seller has not agreed to compensate Buyer's Brokerage in the REPC. This payment shall be made in addition to any other compensation agreed to by the Seller's Brokerage to Buyer's Brokerage, if applicable. Buyer agrees that Seller's Compensation Contribution, combined with any other payment from Seller's Brokerage, if applicable, to Buyer's Brokerage, shall not exceed the amount agreed to between Buyer and Buyer's Brokerage in their written buyer-broker agreement. The provisions of this Section 4.3(e) shall survive Closing.
We are always here, Lean on us.
Our Company Listings: See our contracted BBC
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The MLS Rules prohibit using the MLS, including any of the remarks fields, to market or advertise offers of compensation or commissions to other brokerages, agents, or buyers. This includes, but is not limited to, offers to pay Buyer Brokerage Compensation (BBC), Buyer Agency Compensation (BAC), or any other offers of compensation.​​
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