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Quick question. We are using the same agent to sell our current home and purchase our new home. He told me in the past that there is a discount of sorts (1%) when it comes to commission because we are doing this. How does it work? On the selling end, I understand that we pay the full 6% at closing, but on the buying end is the 1% discount deducted at closing? Or does the realtor send us a check for the 1%?
Quick question. We are using the same agent to sell our current home and purchase our new home. He told me in the past that there is a discount of sorts (1%) when it comes to commission because we are doing this. How does it work? On the selling end, I understand that we pay the full 6% at closing, but on the buying end is the 1% discount deducted at closing? Or does the realtor send us a check for the 1%?
Thanks!
Every agent & or brokerage that offers discounts or rebates will effect them in the way they prefer. There is no standard method. Best thing to do is to ask your real estate agent to detail exactly what discount he is offering and how it will be put in place.
Location: Mokelumne Hill, CA & El Pescadero, BCS MX.
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Here in CA, the escrow company sends us a brokers "demand letter" If I'm discounting a commission, I just edit the amount and return it to the escrow company. If I have agreed to pay any other items like a home warranty, I have them deduct that cost from my commission as well.
We are doing the same (Hi Austin!) - two points on the sale side (so 4% total) and one point on the buy side. I think our realtor will apply each one to the respective closing. They probably only took that deal because we're buying 'up' considerably, and because they've had 8 or 9 transactions over a few years through our family - but in fairness to us, the house we're selling is right next to a model home, so if we stuck a 'for sale' sign in the yard we'd get all the gawkers coming to see the model and the realtor knows it!
He told me in the past that there is a discount of sorts (1%) when it comes to commission because we are doing this. How does it work?
Just ask your agent. He could either reduce the listing commission, or rebate a portion of the commission when you buy. They're not going to send you a check. They will likely reduce the commission on the second transaction...but get the commission arrangement in writing.
We tend to go 5% on the sell side and 6% on the buy side. The listing agreement has a special stip that indicates that they agree to use us to buy their next house, or they will owe the entire 6%. We've never had a problem with a client wandering off the reservation. :-) We don't do rebates.
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