Who Pays the Real Estate Agents? Sellers Pay Their Listing Brokerage, and Buyer Agent Pay Is Set in the Buyer's Written Agreement

This question got more complicated after the practice changes that took effect in August 2024, following the National Association of REALTORS® settlement. Here's how it works in Central Ohio today, using the standard Columbus REALTORS® forms.

The ground rules. Commissions are not set by law and are fully negotiable. In Ohio, agents are paid through their brokerage, not directly by their clients.

The listing side. A seller signs a listing agreement with a brokerage and agrees on that brokerage's compensation. Under the current standard listing form, the listing brokerage doesn't share that fee with the buyer's brokerage, and offers of compensation to buyer agents can't be published in the MLS.

The buyer side. Before touring homes with an agent, buyers now sign a written agreement that states how their agent's brokerage will be paid, as a percentage or a flat fee. That amount is negotiated between you and your agent, up front.

How the buyer's agent gets paid. There are three common paths:

• The seller pays it. In your offer, you can ask the seller to pay your agent's compensation at closing. The seller can accept, decline, or negotiate that request.
• You pay it. If the seller declines and is unwilling to negotiate it at all, and you still want to move forward on the home, you have the choice to revise your offer and move forward without the seller paying it; in that case, the buyer agreement makes you responsible for the amount you agreed to.
• A combination. The seller covers part and you cover the rest. How your loan program treats these payments is a question to ask your lender early.

Protections built into the buyer agreement. Your agent can't be paid more than the amount in your agreement, from any source. Anything the seller pays is credited toward what you owe. And your agent agrees not to filter homes out of your search based on whether a seller is offering compensation.

What didn't change. A buyer's agent still owes you loyalty, obedience, confidentiality, and reasonable skill and care, and a listing agent owes fiduciary duties to the seller.

What to do with this. Talk about compensation at your first meeting with any agent, before you tour. Ask what's included in their service, how the fee works if a seller contributes, and what happens if you end the agreement early. The standard buyer agreement recommends reviewing it with an attorney if you have legal questions.

Want to walk through a buyer agreement line by line before you start touring? Message me. No pressure, just answers.

Norby Fischer | Epique Realty | 614-230-1117 | norbyfischer@epique.me