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If I buy a home without a buyer agent, does seller agent gets all the 5% commission? (Seller agent not presenting me)

  • Last Updated:
  • Aug 13th, 2017 6:21 pm
[OP]
Newbie
Nov 22, 2006
5 posts

If I buy a home without a buyer agent, does seller agent gets all the 5% commission? (Seller agent not presenting me)

I am trying to buy a home without an agent, I did my research, prepared the offer and submitted to the seller agent. In this case, will seller agent gets the 5% commission? Does seller know that I don't have an agent? How do I tell seller that I don't have an agent so he doesn't have to pay full 5% commission to listing brokerage?

Thanks everyone!
9 replies
Deal Addict
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Mar 23, 2008
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Edmonton
The seller's deal with their agent isn't in your control, nor is it any of your business. You make your offer, and the buyer will make their decision based on that. How much they end up clearing after paying their agent might be a deciding factor, but that's for them to decide. Their agent will be responsible for clarifying to them what their final ("in pocket") amount will be based on the commission deal they've worked out.

C
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Sep 12, 2007
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Greely
This has been discussed to death here. Search the forum.
[OP]
Newbie
Nov 22, 2006
5 posts
Thanks Bros. People say when you sell your home with an agent, you have to sign a contract with listing agent to pay him 5% doesn't matter if buyer has an agent or not, is it true?
Deal Addict
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Mar 23, 2008
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ynqynq wrote:
Aug 11th, 2017 1:30 pm
Thanks Bros. People say when you sell your home with an agent, you have to sign a contract with listing agent to pay him 5% doesn't matter if buyer has an agent or not, is it true?
No, that's not true. You might get more complete responses in the "Real Estate" sub-forum, but generally speaking, when you're selling your home, you set up whatever agreement you want with your listing agent. For example, when I sold my home a couple years ago, we worked out a deal with our listing agent to pay him $2500 (flat fee) for setting up the MLS listing and posting signs. Then we had a clause in there to pay the buyer's agent a flat $5000 commission. To further complicate things, these commissions can be included as part of the negotiation process. In our case, the offer we ended up signing bumped the buyer's agent commission up to $6000, making it closer to the "normal" rate.

To be honest, I'm not sure what would have happened if an unrepresented buyer would have come to us directly in our case. I suspect that because our listing agent was no longer involved in the deal (buyer's agents were to contact us directly, and our phone number was on the MLS listing as the contact), we would not have had to pay any commission on the buyer's side. But it would depend on how the agreement is structured.

When we were purchasing a house last spring, we looked at some houses that were for sale by owner. In those cases, as a potential buyer, we put in an offer that included a "1.5% commission to buyer's agent", because we had signed a buyer's agent agreement with our realtor, and if the seller didn't cough up for the commission, we would have been on the hook for it. Again, it was just part of the back-and-forth negotiation process. But we never tried to control how much the seller's agent received, because that wasn't any of our business.

To make a long post longer... There's no "standard" agreement. But typically, when an unrepresented buyer presents an offer, the seller's agent acts as both buyer's and seller's agent. How much commission the seller pays their agent is not really in your control at that point, though.

C
[OP]
Newbie
Nov 22, 2006
5 posts
Thank you so much, very helpful information. I will try to get listing agent to be dual agent which I can benefit a little bit from it. Thanks!!
Deal Addict
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Mar 23, 2008
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You could also try shopping around for an agent that will give you cash-back on their commission.

C
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Feb 25, 2004
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Longueuil
If you don't have a buyer agent, you will likely benefit. It happened to to me (and to a friend) because the agent will pressure the seller to accept your offer even if he could get more from other offers because the agent will get a bigger commission, even if the selling price ends up being lower.
Try not! Do or do not, there is no try...
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Feb 2, 2014
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Toronto
ynqynq wrote:
Aug 11th, 2017 1:00 pm
I am trying to buy a home without an agent, I did my research, prepared the offer and submitted to the seller agent. In this case, will seller agent gets the 5% commission? Does seller know that I don't have an agent? How do I tell seller that I don't have an agent so he doesn't have to pay full 5% commission to listing brokerage?

Thanks everyone!
The listing agreement between the brokerage and the seller is for 5% (for example). The listing agent is authorized to pay 2.5% of that (for example) to the buyer's agent. If there is not buying agent, then the listing agent doesn't have to pay 2.5% to anyone.

So yes, the agent can keep it all.
Kevin Somnauth, CFA
Mortgage Agent and Real Estate Sales Representative
Sr. Member
Jun 8, 2007
879 posts
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Mississauga
If it ends up looking like the seller's agent will keep the full fee, maybe look into finding a buyer's agent that will give you cash back. Not sure where you are, but last I heard, ComFree has buying reps now that offer it. Worth looking into them and other options, of course, but let us know how it works out. When we bought our house, we ended up having the seller's agent double end the deal in the hopes it would help close. We did get the property, but in retrospect I would have rather had a separate agent that offered cashback.

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