Lin Savage wrote:
I am evaluating a proposal from a realtor to sell my current home and
represent me in buying a new home (all in Texas). I would like some assistance in clearly understanding the commission structure as I consider her proposal.In the “right to sell” doc that she gave me, it says that I will pay her 6% of the sales price, and then says that she will offer 3% to the buyer’s broker.Later in the doc, it says she will charge a 4% commission if she represents me on the purchase of my new home (which I intend to do) assuming she is paid a 3% commission from the new home seller. She also says that if one of her subagents represents the buyer of my current home, that she will reduce the commission by .5%.I read your comments about the buyer always paying … I’m trying to follow the money trail to see if this arrangement makes sense for me, and find myself going in circles. Can you explain this to me? Thank you!
Lin,
It looks to me like the total maximum amount you would be paying as a seller is 6% of the sales price of your current home. The 3% she would offer to the other agent is not in addition to the 6% but is money your agent would pay to someone else, who was representing the buyer. If I am correctly understanding what you have written, the 4% would become the maximum (instead of the 6%) if you also purchase your new home through that same agent. And if your agent (or one of her staff of agents) can successfully sell the house themselves (without having to pay a 3% co-broke fee to an outside agent) she will reduce the commission by a half a percent.
If I’m doing the math correctly – and if I were you, I would clarify each of these points directly with that agent prior to signing anything – if her team sells your home and you buy a house through them, the most you would pay is 3.5% and if an outside broker sells the house (but you buy your new home through them) the most you pay her is 4%.
I hope this helps.
Russell
