You can be a REALTOR®’s customer or client.
During our consultation we will review a form defining these relationships and you will be asked to choose which relationship status you prefer.
The Mississippi Real Estate Commission requires that we review this form during our first meeting.
Signing the form does not enter you into any agreement with a REALTOR®; it’s simply a disclosure that states the types of relationships have been explained to you.
“How do I hire you, and how do you get paid?”
Just like when a seller hires a REALTOR® to put their sign in the yard and represent them as their seller’s agent to negotiate for them and guide them through the selling process, a buyer hires a REALTOR® to represent them throughout their home search, negotiation, and purchase.
A seller hires a REALTOR® by signing a Listing Agreement*. The agent on the Listing Agreement gets to put their sign in the yard and is the only agent allowed to represent the seller for the period of time agreed to between the agent and the client. This agreement allows the REALTOR® to represent the seller through the marketing, negotiations, and closing of the property.
A buyer hires a REALTOR® by signing a Buyer Agency Agreement*. The agent on the Buyer Agency Agreement is the only agent allowed to represent the buyer for the period of time agreed to between the agent and the client. This agreement allows the REALTOR® to represent the buyer on all properties whether they are listed with an agent, are for sale by owner, or are currently under construction and are for sale by a builder.
*Neither of these methods of hiring an agent requires paying money to the agent up front.
Once a seller has hired me by signing a Listing Agreement, we then discuss particular in-depth details such as how to best prepare the property for market.
How REALTORS® get paid is confusing. Let me try and clear it up.
While there may be some rare exceptions the good news is that a buyer will almost never pay additional money to cover their REALTOR®’s service fee.
The “service fee” is sometimes called a “brokerage fee”. Although It is sometimes called a “commission”this can be misleading because it is paid directly to the agent’s broker - not the agent.
Agents work under a managing broker, even if they also have a broker’s license. The broker isn’t their “boss” in the traditional sense of the word because REALTORS® are self-employed; however, brokers do distribute a portion of the service fee to the agent after a sale. Agents are responsible for covering all expenses related to running their business like advertising, supplies, and gas.
Hopefully this helps clear up a commonly misunderstood aspect of working with a REALTOR®.
Still have questions? I’d love to meet with you!