There are two options for agents in real estate: represent the seller, or the buyer. Back just a few years ago, the only option for a real estate agency was for the agents to represent the seller. In that scenario, a home seller would acquire a real estate agent in order to sell their home. Essentially, this kind of situation meant that the agent "owed" the seller (accounting, obedience, loyalty, disclosure and care). Potential home buyers would inquire about viewing homes for sale, and an agent would show them houses. In this way, the agent was working as a sub-agent for the seller (whether it was openly advertised this way, or not). By owing the home buyer their skills in addition to honest and fair dealings, the agent was also responsible for disclosing all of the known material facts. The seller got obedience, disclosure of information and loyalty, and the buyer got minor consideration.

Who is responsible for paying for the Buyer's Agent? Initially, the buyer would pay for their own agent, however (over time), this idea did not pan out. The manner in which this concept eventually evolved, is that now when a seller wants to sell their home, there is a contract stating that they will pay for the Buyer's Agent. The agent does not "work" for the seller in a technical sense.

This arrangement allows the buyer to really have the best of both worlds- the exclusivity to hire representation, while the seller is paying for their agent out of the (seller's) closing proceeds.

A common (and false) misconception among buyers is that they can save money if they opt out of having a Buyer Agent's representation. When an agent is hired by a seller, there is an agreement made as to what percentage is being paid at closing. If the buyer is without an agent, and the listing agent (or sub agent) is handling the transaction, the seller will pay the entire percentage to that agent. The person who did not come out on top in this scenario was the buyer; they no longer had anyone working exclusively for them, and saved no money.

Bill & Fran Jenkins

Keller Williams Realty the Marketplace REALTORS

702-845-8540 for Bill 702-860-5432 for Fran