Brokerage Fee Options
for Hybrid Flat Fee Services
Questions or Concerns: Free phone consultation. Cell or TEXT 801-372-1658.
Brokerage Fee / Realtor Incentives
Incentives to MLS Member Agents
Flat Fee PLAN's 30, A, B or C
The purpose of the Multiple Listing Service (the "MLS") is to market properties to Licensed Member Agents and their clients. Exposure to the general public is an added bonus.
Under our MLS Flat Fee Plans, a Brokerage Fee IS NOT required in the listing agreement; but it is recommended.
Licensed Brokers and Agents are directed by the Utah Division of Real Estate to have a signed contract (A Buyer Broker Agreement) with the Buyer noting a specific amount of incentive that the Brokerage charges for Buyer Agent Services. The Utah Real Estate Purchase Contract (the "REPC") notes in Section 5. CONFIRMATION OF AGENCY DISCLOSURE. Buyer and Seller acknowledge prior written receipt of agency disclosure provided by their respective agent that has disclosed the agency relationships confirmed below. At the signing of the REPC:
Traditionally a Buyer Agent is looking for a BAC of 3%, (2.5% is more common in the internet world); most likely this 3% amount is noted on the required Buyer Broker Agreement. This is the inducement to the Buyer Agents to represent the Buyer. If the MLS BAC shows differently, the incentive may become part of the negotiation. A Buyer Agent Commission offered from the Listing Brokerage to the Buyer Brokerage over the MLS is a liability to the Listing Brokerage. As the Listing Broker; I am responsible for any Buyer Agent Commission (the "BAC") offered to member Agents over the MLS system. (see. Listing Agreement Item 2.0 Brokerage Fee) The Brokerage Fee must be accounted for by escrow instructions at Settlement with the Title Company. From the Brokerage fee contracted, we retain 1/2% and offer the balance as the BAC in the traditional area of the MLS. For an "In House Sale" the Brokerage Fee is reduced. (see 2.1 Unrepresented Buyers).
Real Estate Commissions are negotiable and are not established by law.
Based on tradition we do recommend a Brokerage Fee of 3 to 3.5%; This amount would translate to a MLS posted BAC of 2.5 to 3%. The choice of incentive is yours and can be modified as your desire. (3.5% = a BAC of 3% 3% = a BAC of 2.5% etc....) Base on our experience, the internet has caused a BAC of 2.5% posted to the MLS to be very marketable.
A Buyer Agent Commission offered from the Listing Brokerage to the Buyer Brokerage over the MLS is a liability to the Listing Brokerage.
An alternative for Sellers: Compensation Addenda vs Brokerage Fee
As with all our clients we recommend a Brokerage Fee over the Added Compensation Addenda �. But we give you the choice.
Alternative Option. The Added Compensation Addendum. See sect. 2.0 Brokerage Fee of the listing agreement, You may note 0% as Brokerage Fee, also marking in Section 11, there ARE addenda to the listing agreement. Fill out the Added Compensation Addendum.
As per the text in Section 2.0 Brokerage Fee, If the amount is left blank or 0 is noted. We will offer $1 as the BAC. The Added Compensation addendum will be uploaded to your MLS Listing, as a document, and we will referenced it in the Agent Remarks. The Addenda allows you to avoid paying us the 1/2% for represented Buyers, along with reducing our incentive and liability in the transaction.
You may modify this incentive structure as with the other items in your MLS offering throughout the term of your listing contract as desired.
=== If using the Added Compensation Addenda, Agents will view in MLS Agent Remarks Section ===
*See attached additional compensation document. For Access: Contact Seller ###-###-####
(In some instances, the Buyer may attempt to Assign - their Buyer Broker Agreement with the offer).
Depending on whether the Buyer Agent is in the lead role or if the Buyer is directing the Buyer Agent; This may effect whether the listed property is viewed at all.
A low or non-existing Realtor incentive may cause some Buyer Agents to breach their fiduciary duty and simply skip the property.
With all our inquiries. We need to identify if buyer already has an Agent. If they do; Great. The Buyer Agent should be present at showings. If Buyer indicates that they do not have a Buyer Agent we inform them of the advantage of an in-house sale and the reduction in fees involved in any upcoming transaction bettering their offer and reducing the cost of the overall transaction.
Realtor Incentives. Again, our recommendation is a Brokerage Fee of 3 to 3.5%, Saving the Seller 2.5 to 3% in traditional Brokerage Fees and still maintaining an enticing incentive to Buyer Agents. But the choice is yours.
There may be Buyers or Buyer Agents who may be difficult to deal with or may not want to deal directly with the Seller. Our Traditonal Service, Plan B and Plan C put us on the front line. The additional cost for this added Broker involvement in the selling process goes a long way. We negotiate contracts every day. Experience is our best value. Our Goal is to avoid problems, wasted time and transactions that do not close. Lean on us... you may contact us anytime.
TRADITIONAL SERVICES - Leave the Selling to us. Questions for Broker: Principal Broker, Lynn Fillmore
Brokerage Fee of 5%, reduced from the Traditional 6% with 3% offered as the BAC over the MLS.