How Can I Avoid Paying Realtor Fees?

How Can I Avoid Paying Realtor Fees?

Money Classic

50 years of Money. Celebrate with Money Classic throughout the year

By clicking “TRY IT”, I agree to receive newsletters and promotions from Money and its partners. I agree to Money’s Terms of Use and Privacy Notice and consent to the processing of my personal information.

8. Use a Flat Fee MLS Listing Service

Only a licensed agent can list a property on your local multiple listing service (MLS). The MLS is the main directory for local buyers to find available properties, and it pushes your listing to major websites like Redfin or Zillow. 

If you’re going FSBO, but still want to reach as many buyers as possible, there’s one solution. 

For a few hundred dollars, a flat fee MLS service will list your home on the MLS. From there, your listing will populate onto major real estate sites so your home has the same visibility as a home being sold by an agent. 

A flat fee MLS service generally doesn’t do anything beyond that, though. They don’t offer agent services like pricing help, showings, negotiation, or closing support. Some may offer very limited add-on services, like photos or for-sale signs. 

But if you’ve decided on an FSBO sale, you likely don’t want an agent’s help. In that sense, a flat fee MLS listing service is a perfect — and some would say necessary — complement to a FSBO listing.

>> Learn more about flat fee MLS listing services.


Who pays real estate commission fees?

Typically commission fees are paid in full by the seller in the transaction. As explained by top real estate agent Rachel Moussa of Flower Mound, Texas, in most places, “the standard is for sellers to pay both the listing agent and the buyer’s agent’s commission. The listing agent puts on the MLS what percentage the seller has agreed to pay cooperating brokers.”

Find an Agent Worth Their Commission We’ll connect you with three top local agents proven to deliver amazing results for their clients. You won’t regret a dime spent! Find Agent

4 Ways to Avoid Paying Realtor Fees When Selling a House


Hiring a real estate agent is a completely optional step in the house selling process. While it might make sense for certain types of buyers or sellers or certain types of properties, there are definitely ways to avoid paying the commission.

1. Sell Your House For Cash – Usually As-Is With No Repairs Needed


Are you looking for a quick and easy way to sell your house? Have you had horrible experiences with the long, drawn-out process of selling to buyers who are receiving financing for the purchase?


If you’re wondering “how can I avoid paying commission” as well as “how can I sell my house fast,” selling your house as-is for cash might be an appealing option.


When you sell your house for cash, it doesn’t have to be a multi-month long endeavor riddled with staging, showings, cleaning, and stress.


While no deal is final until the papers are signed, the keys are handed over, and the money exchanges hands, cash sales are much less likely to fall through than normal home sales that depend on financing.


A good number of delays in closing occur because of issues that arise from the inspection. As-is buyers might not require an inspection at all. Even if they do require an inspection, as-is buyers aren’t going to require you to complete repairs in order for the deal to go through.


You won’t have to deal with the headache of readying your home for the market, either. It can be time-consuming and expensive to do everything necessary to fetch a high price on the open market.


When you sell your house for cash in Harrisburg, PA, the investor is buying your home in the condition it’s currently in, warts and all.


If you’re interested in selling your home in Pennsylvania super fast, contact our team at First Choice Home Buyers today and get a free, no obligation cash offer.

2. Sell Your House For Sale By Owner – Listing Your Home on The Market


Another option is selling your house “for sale by owner” (FSBO). This means that you are listing your home on the open market without the help of a real estate agent.


Some people attempt this because they don’t want to pay realtor commissions, but they might not realize just how much work they are signing on for.


Real estate agents do have a lot of responsibilities, and when you sell FSBO you are taking on the job yourself. On top of that, a realtor’s negotiating skills can help you get a higher sales price, meaning that you can actually make more money with a real estate agent even when you factor in the hefty commission.

3. Sell Your House to Someone You Know


Maybe you’re lucky enough that you already know a person who wants to buy your house. If this is the case, you can safely forgo the real estate agent and simply hire a real estate attorney to help with the closing paperwork.


However, selling your house to someone you know can cause other issues.


No matter how close you are to the person that you are selling your home to, things can get hairy when you’re dealing with such a big financial transaction. It is definitely best to involve an attorney, which will, of course, cost money, in order to get everything and writing and try to avoid the deal breaking up your relationship with the buyer.

4. Sell Your House to a Cash Buyer


If you’re looking into how to avoid paying realtor fees when selling a house, you might be interested in selling your house to a cash buyer. This method is quick, allows you to set your own closing date, and avoids many of the headaches associated with selling your home.


When you sell your house for cash, it also means you don’t have to shell out a ton of money fixing up your place, cleaning it, and hiring a real estate agent. You don’t have to spend months preparing your property by boosting the curb appeal and repainting the walls. This is a fast and easy way to sell your home without having to worry about realtor fees.

Should you hire a discount real estate broker?

✅ Benefits Significant potential commission savings, particularly for pricier homesMany offer a tech-centric service approachMay create legit value — just be clear on what you’re giving up for those savings❌ Risks You will likely get less hands-on service and support throughout your saleA team-based approach isn’t for everyone and may lead to mistakesOverextended agents may pay less attention to your sale, which could affect your outcome

Discount real estate brokers offer big potential savings — but the risks can be significant as well.

Many of these companies claim they offer full service, but in reality, relative to a traditional realtor, the scope or quality of these services may be reduced substantially.

Is a discount broker right for you?

👍 Good for sellers who:

  • Don’t need a ton of communication from their agent
  • Don’t mind a team-based or remote service approach
  • Don't need an agent’s help with every phase of the sale

👎 Bad for sellers who:

  • Have complicated selling situations
  • Want an agent who communicates promptly and frequently
  • Put a high value on the one-on-one agent/client relationship

» MORE: What to know about discount real estate brokers

For Sale By Owner

For sale by owner (FSBO) listings are one way to reduce the overall commission paid in a real estate transaction. Though, the seller will be responsible for the listing agents responsibilities. This includes photographing and marketing the property to potential buyers. Sellers will also need to negotiate with buyer’s agents and navigate the closing process alone.

If you have experience in the real estate industry, this may seem like a simple enough task. However, a lot goes into marketing a property and you could sacrifice the best price by attempting to handle the job alone. It is also important to know that the transaction will still have a buyer’s commission, so FSBO properties will not avoid these costs entirely. That being said, some owners find this to be the best method. Consider your options and learn more about FSBO properties before attempting to list a property yourself.

5. Consider Dual Agency

Dual agency is when one agent represents both the buyer and seller. If this sounds like it might be a conflict of interest — well, it can be. 

A listing agent’s goal is to get the highest possible price for their client; the buyer’s agent wants to help their client get the lowest price. 

It can be incredibly difficult to balance these opposing goals. And, because of this inherent conflict, dual agency is actually illegal in a few states. 

But, if you want to save on realtor fees, dual agency might be an option. Like buying and selling with the same agent, you can ask your agent to lower their commission rate as they stand to earn two commissions. 

Since dual agency is complicated only consider it in limited situations, such as if:   

  • You already have a buyer and just need an agent to handle the paperwork
  • Your agent represents a great buyer who’s ready to meet your price without negotiating
  • You’re an experienced negotiator who can represent your own interests at the negotiating table

Does the agent get to keep the full commission?

Although the seller pays the entire commission, the listing agent (representing the seller) in a transaction doesn’t keep it all. Part of their commission will go toward marketing your property with professional photography, open houses, offline marketing, and more.

The commission is also typically split 50/50 with the buyer’s agent to compensate them for bringing a buyer to the sale and coordinating the buy-side of the transaction. So, around 2.5% to 3% goes to the listing agent, and the other 2.5%-3% goes to the buyer’s agent.

Both the listing agent and the buyer’s agent will then share a percentage of their commission with their sponsoring broker.

These split rates can vary; however, it’s common for the listing agent to give their broker anywhere from 30%-50% of their commission, depending on the agent’s level of experience, their market size, and brokerage agreement.

How saving on realtor fees works

Selling a house is expensive, and realtor fees are typically your biggest individual cost. Even a minor fee reduction could save you thousands of dollars.

In a conventional home sale, the commission — we’ll use 6% for simplicity’s sake — comes out of the seller’s proceeds and is split between the two agents who handle the sale:

  • The listing fee (3%) goes to the listing agent for helping the seller market the home
  • The buyer’s agent fee (3%) goes to the buyer’s agent for bringing their client to purchase the home

When you save on realtor fees, the rate reduction is usually coming from the listing agent or broker’s fee. So if you saved 2% on commission for a 4% total fee, the overall breakdown might look something like this:

Fee Rate Listing fee 1% Buyer’s agent fee 3% Total 4%

Why does the buyer’s agent fee stay the same?

Reducing the buyer’s agent fee will make it more difficult to sell your home fast and for the best price, plain and simple.

The buyer’s agent commission incentivizes buyer’s agents to show your home to their clients. If you drop your rate below what other sellers in your area are offering, agents will likely prioritize those homes over yours.

Roughly 90% of buyers work with agents.[2] By offering a competitive buyer’s agent commission rate, you’re maximizing your prospective buyer pool and giving yourself the best chance of attracting qualified offers quickly (and ideally igniting a bidding war).

Why are listing agents and brokers willing to work for less?

Listing agents and brokers may drop their rates in order to remain competitive and attract new business.

Several factors are reshaping consumer expectations on what’s reasonable for an agent to charge for helping sell a home:

  • Increased competition among agents for new clients is driving commission rates down (albeit very slowly) across the country[3]
  • Discount services, like Redfin and Clever, with built-in savings are gaining popularity
  • The internet is making the home selling and buying process more efficient and consumer-driven — i.e., agents are doing less work for their clients than they used to

As a result, many agents and brokers are having to be more flexible in terms of their pricing, service offerings, and overall approach to sign new seller clients.

Many have found that by lowering their rates, they can attract more new clients and close more deals, which ultimately makes up for the price reductions.

» MORE: What company charges the lowest real estate commission?

How much can you reasonably expect to save on realtor fees?

Generally speaking, don’t expect to knock more than about 2-3% off your total commission fee without significant service-level tradeoffs.

But ultimately, how much you actually save will depend on how you go about getting those savings.

For example, if you try to negotiate fees with a realtor yourself, don’t expect them to come down too much from their typical rate — 0.5-1% is likely a best-case scenario.

On the other hand, some discount brokers and agent matching services offer huge savings opportunities, with built-in savings 50-70% below the typical rate most listing agents charge.

It’s worth pointing out that, given the high-cost nature of a home sale, any price reduction is going to yield significant dollar savings.

For example, if you were selling a $500,000 home and worked with an agent offering a 1% listing fee, you’d save about $10,000!

Call Bogin, Munns Munns May Today

Buying a home is a major investment. It is understandable that anyone putting so much of their assets on the line would like professional legal guidance regarding the process to help them understand all options that are available, prepare and review documents, anticipate complications, and more.

A real estate lawyer can give you real estate counsel to help you make sound decisions in the sale or purchase of a property. The legal team at Bogin, Munns & Munns can handle virtually every aspect of these often-complex transactions—all the way up to closing.

We work with individual buyers who are looking for a residential home, and we also work with large developers. Whether your realtor will work with for sale by owner or not, we may be able to help you.

Bogin, Munns & Munns can also assist homeowners who are selling their own homes without the help of a realtor but would still like professional guidance with paperwork, applicable laws, process questions, and more. We can also review your contracts to determine if they meet your needs, or if they require modifications.

Our firm has been in the business of serving the people of Central Florida with legal representation in a wide variety of practice areas. We proudly serve our clients in 13 locations across Central Florida, including Orlando (main office), Clermont, Cocoa, Daytona, Gainesville, Kissimmee, Leesburg, Melbourne, Ocala, Orange City, St. Cloud, Titusville, and The Villages.

To learn more about our services and to discuss your real estate needs with a member of our team, call Bogin, Munns & Munns today at (855) 686-6752.

Call or text 855-686-6752 or complete our Request a Consultation form


Leave a Reply

Your email address will not be published.