Buyer Agent Compensation
Definition
The fee paid to a buyer's agent for representation services, which can be paid by the buyer, the seller, or split between parties as negotiated in the buyer agency agreement.
Example
A buyer agrees to pay their agent 2.5% commission. When making an offer, they request the seller contribute 2% toward buyer agent fees. The seller agrees, so the buyer only pays the remaining 0.5% difference.
Exam Tip
Know ALL the ways buyer agents can be compensated: flat fee, percentage, hourly rate, or combination. Understand that sellers CAN still pay buyer agent fees — they just can't offer it through MLS.
Related Buyer Rep Terms
Buyer Broker Duties
The fiduciary obligations a buyer's agent owes to their client, including loyalty, obedience, disclosure, confidentiality, accounting, and reasonable care.
Buyer Representation Disclosure
A form that explains to the buyer the types of agency relationships available and the duties associated with each, required to be provided before substantive discussions begin.
Cooperative Compensation
The practice of a listing broker sharing commission with a buyer's broker, historically offered through the MLS but now prohibited from MLS display under the 2024 NAR settlement.
Buyer Consultation
An initial meeting between a buyer and agent to discuss the buyer's needs, explain agency relationships, review representation agreements, and establish expectations for the home-buying process.
Buyer Loyalty Obligation
The duty of a buyer's agent to act solely in the buyer's best interest, avoiding any conflicts of interest and putting the buyer's needs above the agent's own financial interests.
Termination of Buyer Agency Agreement
The legal ending of a buyer representation agreement, which can occur through expiration, mutual consent, breach, or specific termination provisions outlined in the contract.
Frequently Asked Questions
Test Your Buyer Rep Knowledge
Practice with exam-style questions to make sure you can apply Buyer Agent Compensation and other buyer rep concepts.