Many advance companies in California get asked about how realtors are compensated. This can be a complicated question to answer as there are a few different kinds of commissions. If you have been wondering this same thing, then this article will outline some of the most common forms of realtor compensation we use. Each commission advance company in California will encounter these same payment processes.
Exclusive Right to Sell Commissions
Realtors love having their clients sign these contracts. Basically this means that even if another agent is actually the one to close the deal that finally sells the house, the original agent reserves the right to take their contracted share of the sale price. The most common percentage we see in the real estate world is 3%.
Exclusive Agency Commissions
When you sign up with an agency rather than a specific agent, then you will get the help of many people at the agency. How the agents get paid in these scenarios will differ for each company. Some will pool the commissions with all who helped, and others will assign one person who will get the lion’s share of the money. Each sale, however, will give part of its whole to the agency owners and/or managers. This is like paying dues for working under the umbrella of a successful company. Signing this kind of contract means you will pay them if the house sells before a specific time frame. Usually that time frame is 6 months. This is by far the most common listing practice.
Open Listing Commissions
This listing type will give you the most freedom as the seller, but will also solicit less loyalty from the agent. This means that you will get the help of an agent, but whoever is the one to bring about the sale will be the one to get the commission from the sale. Agents working under this listing type will be aggressive, and will also have other projects going on due to the possibility of losing the sale to others.