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Here's how a Realtor is paid. You, the client, and your Realtor agree to a commission amount at the time you sign the listing agreement. I've seen commissions anywhere from 3% for a limited service to 8% for homes or 10% for vacant land. The commission is always negotiable at the time you sign your listing agreement and often is negotiable even after that. I've certainly dropped by commission amount to help a sale go through.



So, your 7% is paid to the brokerage company that your Realtor works for. In exchange for placing your listing in MLS, your Realtor's broker agrees to pay part of that 7% to the cooperating broker, or the broker who represents the buyer. Usually that'll be half of what you pay your broker. So, your broker will get 3.5% commission and the buyer's broker will get 3.5% commission. At or after closing, the agents will get paid by their respective brokers. How much of that commission they get will depend on their independent contractor agreement with their broker. Some get 100%, some get as little as 50%.



Your friend's Realtor got 2.5% and the total commission was probably 5%, unless your friend was working with a limited service broker.



As with anything, remember you get what you pay for. Commissions in my area normally range from 5-7% for a home.



So, in your transaction, you're paying 7% commissions which will somehow be split between the seller's broker (your broker) and the buyer's broker, AND you're agreeing to pay up to $3,000 of the buyer's closing costs which isn't necessarily unusual in today's market. The closing costs may also be a requirement of an FHA loan in which FHA requires that the seller pays for up to 3% of the purchase price in buyer's closing costs.

Most real estate contracts state that you will pay 6% for a commission, but yours is 7%. So half of the 7% is going to the agent that listed your property(3 1/2%), then another (3 1/2%) is going to the agent who brings in the buyer to the deal. You are paying an extra 1% than most contracts, but there are still a lot of agents who negotiate for a higher commission.



Then if you are paying for all of the closing costs, that is more that you are paying at the close of escrow. So muliply the selling price of your house by .07. (example: a house selling for 100K would be 100,000x.07=$7,000).



Some sellers negotiate the commission down from the regular 6% to 5%. Most agents will not go lower than 5% because it's not worth all the work at less than 5%. Then the 5% would be split amongst the agents in the same way, which would be 2 1/2% per agent.



If your agent finds the buyer herself/himself, they get the entire 7%.

Where I am its usually 6%, split evenly but its negotiable and 1% more or less is not uncommon. I would suggest talking to some other successful realtors in your area and see if they will take 6%, I bet you'll find one no problem, but be sure you only deal with successful realtors. There are alot of newbies willing to take less but in this case you get what you paid for.

culturally, the listings across the US

offer 7%, to be split evenly between

the seller's broker and buyer's broker.



This number, having been researched,

can go from 0% on specials to 15% for

commercial.



the number is always negotiable

2.5 % sounds like a listing broker's commission after paying off coop booker. 7% is the norm in some areas although 6% is more prevalent. Sometimes I charge 3% and keep 0% in a coop.

In Ca. it's negotiable, however it's usually 5-6%, of the selling price,and that is split between the selling and listing agent. Get a new agent.