How do real estate commissions work?

The commission is the fee for the agents' work in marketing and completing the sale. It is usually a percentage of the sale price, though it can be structured other ways.

It is the compensation for the expertise, marketing, and coordination that bring a deal to closing.

In a typical sale, the commission is paid from the seller's proceeds at closing. It is agreed in the listing agreement and deducted when the sale closes.

The total is then split between the listing agent and the buyer's agent according to the agreements.

The commission negotiated in the listing agreement is divided between the brokerage that listed the home and the brokerage that brought the buyer.

Both agents and their brokerages each receive their portion at closing, and the terms are documented in writing.

The commission covers the work of selling: pricing, marketing, photography and staging coordination, showings, negotiation, and managing the transaction through closing.

It is worth understanding what your agent provides so you can see the value behind the fee.

I explain commission structure clearly before we begin, so you know exactly what to expect and what services it covers.

You make decisions with full understanding, no surprises at the closing table.