Every single person on the planet wants to get as much as possible for their home when they sell. And they don’t want to pay too much in real estate commissions while they’re at it. In recent years, discount brokers have been advertising the fact that they charge less and save people money. I’m going to tell you how they charge less and why it may or may not be the best thing for you.
First, lets talk about commissions. When you sign a contract to list your home with a discount agent, you agree to pay them a commission and they share that commission with any other agent in town who can bring you a buyer. How much those discount agent share with another agent ranges from 2% to %4 in most areas. Whether you go with a full service agent or a discount agent, you’ll agree to pay another agent if they bring you a buyer.
So if you agree to pay 3% to another agent who finds you a buyer, the agent listing your home gets anything on top of that. The only difference between full service and discount agents is how much of what is left over they get at the closing table. Discount agents will often take a flat fee at closing or up front. Full service agents typically get their commission at closing. Their commission is typically twice what the agent who finds the buyer gets. In our example, the full service listing agent will get 3% also. This would bring your total commission to 6%. With a discount broker it would be 3% plus a flat fee or something like 4% or 5% total commission.
With either a discount agent or a full service agent, you’ll typically get access to the MLS. Since the marketing strategy will be basically identical, the difference lies in the service.
With a full service broker, you’ll be able to talk to your agent on a regular basis and they’ll most likely be responsive to changing conditions and will answer any questions you might have. With a discount agent, you probably won’t get much personal service. When you call them, they may tell you to “make it quick” and not have time to deal with your issues because they aren’t setup to do that. Since the payoff when they sell a home is less than a full service agent, they spend most of their time trying to get new clients. They don’t have a lot of time to service their existing clients.
But this isn’t necessarily a bad thing if you’re familiar with the home selling process and know how to properly stage your home for showings, negotiate contracts, and handle all the closing details with lenders and attorneys. If this something you’re comfortable with, then a discount broker would most likely be a good fit for you and you could save a little money.
If you see that you’d rather focus on moving to your new home and not all the details associated with real estate contracts, then you’ll probably save money and headaches going with a full service agent. Missing critical details on a contract or at key moments in the process can often be extremely costly for people who don’t have experience selling a home.
So there you go. I hope this helps when you’re deciding which agent to hire to handle the sale of your home!
Resources: Alpharetta Real Estate | Atlanta Real Estate | Canton Georgia Real Estate | Cumming Real Estate | Kennesaw Real Estate | Marietta Georgia Real Estate | Roswell Georgia Real Estate | Woodstock Georgia Real Estate
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