The Basics of Selling a Home
This article is for the Seller that is new at selling a home. It is meant to bring you up to speed so you can understand a few simple hacks that may save you thousands.
1. The Seller Pays for All of the Sales Commission
A surprising factor when you were buying a home may have been how you did not have to pay any commission to your agent. Now, you face the other side of that coin. Seller’s mostly pay all commission to their Listing Agent. Traditionally, that commission is 6% of the contact price (not the listing price).
2. Listing Agent “Shares” That Commission
It is not for the benefit of the Sellers, but for the benefit of the Buyer’s Agents. Overall, remember that the Listing Agent is required to have the correct data for the Buyer’s Agents to procure the sale of the property. This sale comes with a compensation for the Buyer’s Agent. The usual Buyer’s Agents commission can be between 2.5% to 3%. Nothing less than that commission amount is recommended for the effectiveness of the sale of the MLS Listing.
3. Each Agent has a Broker
Each Broker is truly your representative on the sale of your home. Some Brokers have sub-Agents (usually Real Estate Agents) that work for them and with you to assist in the sale of the home. Major Real Estate companies have more than just Agents, some have Mentors, Assistants, Coordinators, etc. This is also why the commission stays at 6%, there are just simply too many people taking from that commission.
This word is used plenty but brings little value to a Seller and/or Buyer. Each side pays a certain closing cost, even if the contract states it otherwise. Try to avoid the word “Closing Costs” and ask for the contract to have specific details on costs.
5. There are Cheaper Work Arounds
Yes, this is where we encourage you to learn the Flat Fee MLS system. Do avoid For Sale By Owner, it may be more costly than a traditional sale.
Basically, selling a home can be very complicated on the terms of costs. We hope to properly advise you while making sure you avoid paying 6% Could you imagine selling a home now a days can be this costly?
Will Puente, PhD, MBA, JD Candidate