Does Your Agent Get Paid If You Buy A House For Sale By Owner?
If you hired a real estate agent to help you look at homes for sale, your agent will get paid from the commission on the sale of the house you choose. If you happen to find a house that is for sale by owner that you are interested in, you may want to talk to your agent about it before you go and look at it. People who sell their homes by owner do not have to pay commissions to agents, and that is the main reason people try using this method; however, just because a house is for sale by owner does not necessarily mean your buyer's agent will not receive a commission.
How commissions normally work
Normally, houses are sold through real estate agencies, and the commissions are paid by the sellers of the homes. The agent that lists the house will get part of the commission, and the rest of it is split between the agency that lists the house and the agent that finds the buyer. A house that is for sale by owner will not have an agency selling it. Instead, the owners of the house are selling it themselves, and this eliminates the need to pay a commission.
This doesn't mean the sellers will not pay a commission
It's important to realize that many homeowners are willing to pay a commission to an agent if the agent brings a buyer, and this is true even if the house is for sale by owner. To find out if a seller is willing to pay a commission, you may need to look at the flyers for the house or the sign posted in the yard. If the sign says, "Will Work with Buyers' Agents," the seller is saying that he or she is willing to pay a commission to a buyer's agent if a showing results in a sale.
The commission is not likely to be the same rate as it would be with a normal sale, but it might be around 2% to 3%, which is approximately half of the normal commission rate.
The seller might not agree to pay a commission
If the seller is not willing to pay a commission, your agent might back out of the deal, simply because he or she would earn anything if you purchased this house. This can be a hard situation to be in, because you may really want that house but do not want to upset your real estate agent. In this case, you might want to ask the home seller if they will accept a lower price than what they are asking. If they agree, you could pay the agent a commission out of the money you saved on the house.
Buying a house is an event that you might only go through once in your life, so you should take your time to find the right house. To have assistance with this process, hire a real estate agent in your town.
Share