How are commissions split?

[Bryant Tutas]

Today I want to briefly talk about commission splits.

Every Real Estate Transaction has two sides. Selling side(buyer) and Listing side (seller).

If you are working with a Buyer and "sell" a property you have earned the selling side or Co-broke commission. This portion of the commission is then split according to your commission arrangement with your Broker(me).

The listing agent is always entitled to the listing commission regardless of who sells the property. Of course if it is your listing you also have to split with your Broker the listing side.

If you have the listing AND sell it to a Buyer then you get both sides of the transaction which are then split with the Broker.

In our company referral fees always come off the top prior to any splits. This way we all share in the cost of the referral.


For example: Let's say I have a listing at 6% and you sell it to a Buyer who was referred to us for 25%. The property sells at $100,000. The break down is as follows:

$100,000 X 6% = $6,000

$3,000 to the listing side
$3,000 to the selling side

Off the top of the selling side we have to pay the 25% referral fee or $750. So......$3,000 - $750= $2,250 which is then split according to your percentages.

My advice is to never get hung up on commissions. Our jobs are to help Buyers buy and help Sellers sell. If we do this often enough we will get paid very well for our efforts.

Property values are very low right now so we do have to help more people.