NAR Settlement
With so many headlines spreading false information, it's hard to tell what is correct and incorrect.
We want to make sure you stay fully aware of the TRUTH to be able to make your decisions accurately.
Check out the info below and if you have any questions, we are happy to speak with you and help you understand!
IS IT TRUE THAT SELLERS NO LONGER HAVE TO PAY A 6% COMMISSION TO A BUYER'S AGENT?
It's only true that there was never a set commission that sellers paid.
A seller and listing agent/brokerage negotiate a commission to sell and market that seller's property. That listing brokerage then decides to pay a buyer's agent out of the commission they are getting.
The NAR nor this settlement have anything to do with setting & establishing commissions.
IS IT TRUE THAT SELLERS DON'T HAVE TO PAY A COMMISSION AT ALL TO A BUYER'S AGENT?
Again, they were never forced to. But sellers understood that by negotiating a compensation with a listing brokerage that allowed for them to pay a buyer's agent was a system that worked well.
Before, the MLS system would not allow a listing agent to put in a listing that didn't offer a buyer's agent compensation. This has currently changed and will now allow for a listing agent to offer no buyers agent compensation and still be able to put the listing in the MLS.
Under the NAR settlement the MLS system will no longer have a spot to show how much the buyer's agent compensation is.
IS IT TRUE THAT THIS SETTLEMENT WILL DRIVE HOUSE PRICES LOWER?
No, it's not true.
House prices are because of supply and demand and how much a buyer is willing to pay for it. Home prices have risen greatly in the past few years.
There are many aspects that go into pricing a home. How much a seller is paying for real estate agents will not be a determining factor.
IS IT GOOD FOR A BUYER TO HAVE TO PAY FOR THEIR OWN REPRESENTATION?
Not necessarily. Before, the cost of their agent was basically rolled into the loan. The buyer paid for the home and the seller paid the commission out of their proceeds. But between the buyer's down payment, closing costs and out of pocket expenses (such as appraisal, inspection, etc.), it could seriously hinder a buyers ability to purchase a home if they are required to pay their agent out of pocket. Again though, a majority of sellers understand the importance of real estate agents' commission and are still willing to work with everyone involved. We, as real estate agents, are there to help get you into your dream home and negotiate for what best fits YOU!
WHY DO I HAVE TO SIGN A PAPER NOW TO SEE A HOME?
All Realtors are now required to have an agreement signed by the buyer to see a home. We have three different forms we can use - 1) Pre-Touring Agreement​. This states the brokerage that is showing you the home, the buyers name, how many days that agreement is good for and also the commission amount your Realtor is getting paid. 2) Showing Agreement. This one takes it a step further and gives a range of dates, lists the properties being shown and has a spot to fill in if a brokerage requires a retainer deposit. 3) Buyer Brokerage Agreement. This one is a commitment to your agent to exclusively work with only them for a specified amount of time.
With each of these agreements, it is clearly shown expectations from both sides and also how much commission your agent will be getting. Commissions, just like home prices, are always negotiable to fit your budget and what you need. There are still a lot of sellers who are offering a buyers agent commission and willing to pay so you may not have to pay anything at all to your agent!
If there are any questions about these forms or how they work, all of our agents are more than happy to go over them step by step and make sure you are comfortable with it.
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WILL THERE BE NEGATIVE IMPACTS FOR SELLERS IF THEY DECIDE NOT TO PAY A BUYER'S AGENT?
It's possible to see negative impacts. A lot (but not all) of buyers prefer to use a real estate agent to guide them along the way because of the expertise and knowledge an agent has. Buying a home can possibly be the biggest purchase ever in someone's life. They want to make sure everything goes smoothly. Not paying a buyers agent can possibly result in the home sitting on the market longer than expected and potential issues with the process.
WHAT IF I HAVE MORE QUESTIONS ABOUT LISTING MY HOME OR WITH THE LAWSUIT?
Please call us and we will happily go over any questions you have. We always off a free market analysis on your home with no strings attached. We genuinely want to talk about everything going on and help ease your mind!
