Who really pays for the buyer’s agent? Get the surprising facts!

If you guessed the buyer, you're right!

Key takeaways:

  • While it's true that you don't directly cut a check to your buyer's agent, that money has to come from somewhere, and it's not the seller's wallet
  • The money that's used to pay your agent is actually built into the cost of the home
  • Home Savi finally lets you recapture this money for yourself and save

“Why wouldn’t you use a buyer’s agent? They’re free because they’re paid by the seller.” If you’ve been researching the home buying process, this is probably a phrase you’ve encountered before, but is it true? Where does your agent’s commission really come from?

How do commissions work?

In California, the buyer’s agent is paid through a co-brokerage fee with the listing agent, who's paid by the seller. But, the seller pays their listing agent with the proceeds from the sale, which they get from you—the buyer. As a buyer, you're the one bringing money to the table; you're the one paying for your agent!

So, even though it can seem like you’re not paying for a buyer’s agent, you very much are. The source of the cost is blurred because it's built into the price you pay for the home.

Home Savi lets you represent yourself, make your own offers and recapture all of the buying agent’s commission, which you can then use to pay off closing costs, finance a remodeling project, buy new furniture or even take a well-deserved vacation—it's all up to you! Learn how Home Savi's proprietary purchase contract makes this possible here.

With you, the buyer, electing to self-represent, everyone else in the transaction, including the seller and the listing agent, still get paid the same as they would in a conventional sale. You, however, get to save the money that would have been used to pay your buyer’s agent. It's really that simple.

A closer look at commissions...

Who pays for the buyer's agent infographic

Put your savings to use

One of the biggest advantages of using Home Savi is that you can use your savings in so many different ways. For example, you can use them to increase your offer price. Because you get to keep all of the buying agent’s typical 3% commission, you can instead use that money to increase your offer price by 3% and outbid competing offers in competitive markets.

On a $500,000 home with multiple offers on the table for that asking price, you could offer $515,000 without actually paying more than someone offering $500,000 through an agent. So, ready to take control of your home buying journey and save big at the same time? Get going by learning more about buying a home without an agent and about the 4 things you should do before making an offer on a home.

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Photo credit: Low Jianwei (edited)