If you`ve decided to sell your home as a “for sale by owner” (FSBO), then you may be wondering about how to handle the commission for the real estate agent who brings a buyer to the table. While it`s true that selling your home without an agent means you don`t have to pay a listing agent`s commission, you will still be responsible for paying the buyer`s agent commission.
To help navigate this process, it`s important to have a clear understanding of the for sale by owner commission agreement. This agreement outlines the terms of the commission paid to the buyer`s agent, which is typically around 2.5-3% of the sale price. Here are some key points to consider when creating a for sale by owner commission agreement:
1. Decide on the commission rate: As mentioned above, the commission rate for the buyer`s agent is typically around 2.5-3% of the sale price. However, you may be able to negotiate a lower rate depending on the local market conditions.
2. Determine when the commission is due: The commission is typically due at closing, after the sale has been completed. However, you may be able to negotiate a different payment schedule with the buyer`s agent.
3. Clarify who is responsible for paying the commission: As the seller, you are responsible for paying the buyer`s agent commission. However, it`s important to make this clear in the commission agreement to avoid any confusion.
4. Include any necessary disclosures: Depending on your state and local regulations, you may need to include certain disclosures in the commission agreement. For example, some states require sellers to disclose if they are licensed real estate agents themselves.
5. Work with a real estate attorney: To ensure that the commission agreement is legally binding and covers all necessary details, it`s a good idea to work with a real estate attorney. They can review the agreement and make any necessary revisions to protect your interests.
In summary, a for sale by owner commission agreement is an important document for any seller who is handling the sale of their home themselves. By understanding the key points of the agreement and working with a real estate attorney, you can ensure a smooth and successful sale.