1. Split Commission Model: Starting August 17, 2024, commission information will no longer be communicated via the MLS (Multiple Listing Service). Compensation agreements based on commission must now occur off-MLS through negotiation and consultation between real estate professionals. These agreements may still follow the traditional split commission model, where real estate Brokers are paid a commission based on the final sale price of the home. This commission is typically a percentage agreed upon between the seller and the listing Broker. If using this payment model, the buyer's Broker would receive a portion of the commission, as arranged between the listing Broker and the buyer's Broker. Typically, all commission payments go through the broker managing the brokerage where the Broker works. From there, the commission is split between the managing broker and the associate Broker according to their internal agreement. 2. Direct Payment from the Buyer: The buyer may agree to pay their Broker directly. This can be a flat fee, an hourly rate, or a percentage of the purchase price. 3. Negotiated Arrangements: Other customized compensation agreements can be negotiated between the buyer and their Broker. Before you start touring homes, you will need to enter into a written buyer’s agreement with your Broker. This agreement will outline the services your Broker will provide, the compensation structure, and other terms of your working relationship. The greater flexibility for Broker compensation methods due to recent changes in regulations reinforces the importance of entering into a written buyer’s agreement. This formal agreement ensures both parties are clear on expectations and protects your interests throughout the home-buying process.
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