Truths about the Buyer Rebate Commission
Do you have a clue about a buyer agent commission rebate? A buyer agent commission rebate can mess up the buyer, seller and the agents of both sides if all the parties involved are not careful. Read more facts about home buyer rebate commission.
There are many terms that are used to refer to a buyer agent commission such as a home buyer rebate, buyer closing credit, realtor rebate, buyer rebate, home buyer cash back, a commission kickback and more. The buyer and his or her agent agree on how they will share the commission of the agent after the transaction.
The seller pays the buyer’s agent a fee indirectly. The seller pays the listing agent a commission and the listing agent, in turn, pays the buyer’s agent a percentage from that commission. The listing agent can keep the whole amount if the buyer has no agent, which rarely happens, and act as both a listing and buyer’s agent.
Buyer rebates are legal and illegal in the US depending on the states. As a realtor or real estate company, carry out research before you use buyer rebates to attract customers in any state in the US so that you do not rub shoulders with the law.
The challenges that buyer rebates expose traditional realtors have made them adamant to accept the change. The realtor will have to remain as either a listing or buyer’s agent but the latter is the most disadvantaged. A buyer’s agent may not get his or her share from the commission that the seller will give to the listing agent if the listing agent is a selfish person.
Buyer commission rebates are rare because of the existence of the real estate brokerage. Dual agency is created because the buyer’s and seller’s agents have to corporate for the deal to close. The majority of the buyers are represented by their agents and a significant percentage of homes are listed before they are sold. There is a rift between traditional and rebate realtors because the former are not willing to work with the latter.
Traditional agents can negotiate with listing agent for a reduction on the contract price after the offer has been accepted so that the buyer’s agent gets a commission rebate before the deal is closed. If your lawyer can agree with the attorney of the seller, the contract price can be reduced by the rebate amount and the same will be done on the buyer agent’s commission. It does not matter if you have already signed the contract because your lawyer can get the rebate to be applied to you as credit by negotiating with the agent of the seller.
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