During one of our weekly training sessions, the subject of commissions came up and someone asked, "How do you get the Sellers to agree to pay Full Commissions?" As we all know, there are no set commission rates when selling Real Estate.  This was one solution our Team Leader, Bill Kilpatrick suggested when it comes to negotiating commissions.

He goes on to say, When you go to your Listing Presentation, have with you 7-One Dollar bills. Put 6 of them in your pants pocket, and one of them in your shirt pocket. When you are sitting at the table, and you start talking about commissions and the Seller is trying to get you to agree to Discount your commissions, you pull out your 6-One dollar bills from your pants pocket and place them flat on the table next to each other. When your Seller is done talking, Ask them how motivated are they to get their home Sold? Listen to the answer. Respond something like this.(This does not have to be verbatim, but similar)

"Mr. Seller, Do you know that in todays market, there is an abundance of inventory on the market. That every Listing out there similar to your property is your direct competition, and every week there will be more Listings coming onto the market, which will be additional competition. So we need to aggressively price your Listing to show value first then price. Do you want your property to be used as a comparison to Sell your neighbors house, or visa versa?" The answer most likely than not will be the Seller wants the other listings to be used to Buy HIS property.

Continuing, "Even though Realtors are not supposed to choose and pick what listing they will show their prospective clients, there are Realtors out there that when there are 2 exact properties on the market with the exact same features, but one is offering a 2% commission and the other is offering a 3% commission, which property do you think that Realtor will pull up and show his Client?  We ALL know that this is not what Realtors are suppose to do, but believe me it happens. "So if we list your property for less than 3%, you can expect your property to be on the market longer. Do you really want to keep your home clean for 60, 90 days or longer, for all those Open House I will be doing and having all those people come through, just to buy your neighbors house who is offering 3%?"

We have stats that prove that theory. Listings that offer 3% commission sell FASTER than listing with a lower commission!

So hear me out. "Now look at these 6 dollar bills, each represent 1% commission in the sale of your Home". Tell your Seller "As Realtors, we typically split the commissions 50-50 when the transaction is complete with the Buyer's AGENT." The Realtor goes on, "now from what I understand from you is that you are a motivated Seller, correct?" So, we want to make sure ALL the REALTORS who are looking at our listing can see that you are motivated because we priced it aggressively to the market and we will be offering a Full 3% cooperating commission to the BUYERS Agent, guaranteeing us that your Listing WILL be shown by every Agent out there."

At that time, take 3-One dollar bills and put them to the side, and say"This is for the BUYERS AGENTS commission". Now you see we have 3 dollars left. Tell your Seller "This is what my share of the commission will be left, 3%".(point to the 3 dollar bills).

Now pick up one of the dollar bills and say, as your Realtor, I am going to need to advertise your listing, put it in the newspapers, magizine ads, make flyer's & brochures for the property to pass out, and I will send send postcards announcing your home for sale to the neighborhood and any other clients I have in my data base,etc. (Use whatever marketing strategy you have) So this one dollar bill represents my advertising budget that I will do to promote your property. Now you have 2 dollars left.

Now pick up another dollar and tell them, since I am a affiliated Realtor with a Real Estate Company, I must give a portion of my commission to my Real Estate Company, remove the 2nd dollar bill. This goes to my Real Estate Company, Broker.

Now say to your Seller, "Now this is what I get for the sale of your property. I will be taking care of the whole transaction for you by Listing, marketing and negotiating the sale of your property. I will screen the BUYERS, Hold Open Houses and keep you informed throughout the entire process. This is also what I get to take home to feed my 2 kids and pay my mortgage, etc. Now remove the last one dollar bill.

Turn to the Seller and now ask, "so you have asked me to take a reduction in my commission? Turn to your Seller and look at them in the eyes and say "What do you don't want me to do?"

That is a very good visual which works all the time.

Now, I go on to say, "now if you are really motivated Mr. Seller and want to guarantee that your home will be the first one SOLD in this market, (Pull out the dollar bill from your shirt pocket) "I would really sweeten the pot" and take that dollar bill and put it on the BUYERS AGENTS commission. You can always tell them that you will agree to take a reduced commission if you bring in the BUYER yourself, that will make the Seller Happy.

This was hard to explain in the written format, but I hope you get the idea of what I was trying to get across. Good luck and go out there and get them 6% or better yet, 7% Listings!