The listing agent contracts with the seller the commission that the seller will pay on the sale of the property. When a buyer’s agent brings the buyer, the listing agent splits the contracted commission with the buyer’s agent. So, commissions on a real estate transaction are, in a majority of cases, paid by the seller.
HOW TO CHOOSE THE BEST AGENT FOR YOUR NEEDS
You might feel the urge to pick the first real estate agent who appeals to or approaches you, but that’s something to avoid. Like with any professional, there are degrees of professionalism, dedication, and experience. The “wow factor” will simply wear off. Meet with prospective buyer agents before you make a choice. A good buyer’s agent will want to know whether you are loan- preapproved by a lender or bank, what kind of loan program you're approved for, and the terms of the loan you’re getting. They should spend adequate time to discover what you’re looking for in a house. They should listen as much as talk and ask questions. If the agent doesn’t broach the topic, ask for an explanation of his understanding of agency relationships and obligations to you. The law requires agents to explain whether they’ll be working for the buyer or the seller whenever they have substantive contact with a customer or prospective client. If the agent doesn’t offer you a buyer’s agency agreement, that agent is representing the seller, not the buyer. If the agent can’t explain agency concepts to you, then move to the next agent. Be sure that the agent will be showing you all listings or properties on the market that meet your requirements, not only listings that are handled in-house (that is, from his brokerage).
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