Brokerage Fee Explained
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
Under our MLS Plans, a Buyer Agent Commission IS NOT required to list; but it is recommended. 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.
Licensed Brokers and Agents 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.
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:
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. (see Section 5 above). 2.5% has become acceptable to most Agents in our experience.
This "BAC" is the inducement to the Buyer Agent to represent the Buyer. If the MLS "BAC" shows differently, the incentive may become part of the negotiation. A "BAC" offered from the Listing Brokerage to the Buyer Brokerage over the MLS becomes a liability to the Listing Brokerage. As the Listing Broker; I am responsible for any "BAC" offered to MLS Member Agents over the MLS system. (see. Listing Agreement Item 2.0 Brokerage Fee)
The Choice is Yours.
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.
$1 is the minimum amount for a Listing to be Posted to MLS. If Seller leaves the "BAC" amount blank in Section 2 of Listing Agreement; $1 will be posted from the listing fee due from Seller.
The Brokerage Fee / Buyer Agent Commission, 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 will be reduced as noted. (see 2.1 Unrepresented Buyers).
*Real Estate Commissions are negotiable and are not established by law. The Choice is Yours.
With all inquiries. We need to identify if the buyer already has an Agent. If they do; Great. The Buyer Agent should 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 and the reduction in fees involved in any upcoming transaction. The lower cost of sale betters their offer. You, the Seller may Opt out of the In-House Sale Service
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.
Lean on us.