Realtors understandably want to protect their investment (time, effort,
money) in selling your property. The Brokerage Fee section of the
contract is usually found right on the front page and deals with, not only
their payment for selling your property, but an obtuse clause that a
Seller would not typically associate with a discussion of realtor fees.
This ‘fine print’ subject is solely for protection of the realtor and,
while it may not be labeled as such in the contract, it is commonly
known in the real estate industry as the Protection Clause.
Brokerage Fee Section
Real estate commissions are generally from 6 to 10 percent across the
country, depending on the type of real estate. Why is the fee stated in
terms of percent instead of dollars and sense?
Fees are stated in percent primarily because the real estate market is
based on commissions.
A realtor wants to sell your property for the
highest price, because they get bigger commission check. This commission
system motivates realtors to work harder at getting the highest price
for the Seller.
Another added benefit to the realtor is the same idea behind an
automobile being priced at $2999 instead of $3000. Doesn’t it sound better to
hear you have to pay 6% of $100,000 than have to shell out $6,000?
Allow Only the Smallest Bite Out of Your Apple
You can negotiate with the realtor what percents you want to pay for
selling your property. Say commissions are running around 6% for homes
in your area. If you tell the realtor you’re willing to pay 3% to him
and 2.5% to the buyer’s realtor, you’re saving .5% of the commission.
If your home sells for $100,000, then you just put $500 back in your
pocket. It’s no skin off your realtor’s nose as their piece of the pie is
still intact and you’ve saved yourself a hefty chunk of change. This
strategy is especially effective in a Seller’s Market (more people
trying to buy homes than people willing to sell their homes).