Realtor Commissions

[Lee Allen]

This is a guide to help you understand Realtor commissions. You can use this to your benefit to make cash offers to Realtors.

On a $150,000 house with a typical 6% commission is $9000.

This commission is split the follow ways

$4500 go to the selling agent & his broker
$4500 go to the listing agent & his broker

Out of the $4500 that the agent receives here is a breakdown
$900 goes to the broker
$1440 goes to pay Federal taxes & Social Security
$300 for advertising the property
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$1860 is what a Realtor nets out of a $9000 commission

Also about half of the properties that a Realtor lists will never get sold. That means that I will spend $300 on advertising on many properties that will never sell.

You can use this information to go to a Realtor and offer them $1000 cash for their expired listings that fit your criteria.