How Commissions Work

Traditionally, the seller covered the real estate commission, a percentage of the home’s sale price. This commission was then split between the seller’s listing brokerage and the buyer’s brokerage. Each brokerage, in turn, divided that commission between their respective agents – the listing agent and the buyer’s agent.

But the real estate landscape is changing, and so is how buyer’s agents are compensated. Nowadays, sellers can either offer to pay the buyer’s agent directly or provide a credit to the buyer at closing, which the buyer can use to compensate their agent or completely leave it up to the buyer to compensate their buyer’s agent themselves.