When do real estate agents get paid their commission?

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When you buy a house, there’s one person who ensures you don’t get taken advantage of by the seller: your real estate agent. This person is also called a broker or someone who helps buyers and sellers negotiate prices on houses. Agents represent both the buyer and seller in their negotiations. They are often paid by their clients when they reach an agreement over the price. So what happens if you’re buying a house and want to know more about when real estate agents get paid their commissions?


When do real estate agents get paid?

Real estate agents are paid when their clients close on a property. In most cases, an agent will get paid at the end of the transaction. There are some exceptions to this rule, however. For example:

  • Some agents might get paid before closing when an offer has been accepted, and there are no contingencies in place that could cause it to fall through (e.g., if the buyer fails to obtain financing or if inspections reveal something significant).
  • Other agents may receive commission checks after their clients have completed inspections as long as those inspections were conducted with no issues or concerns raised by the buyer or seller’s inspector.
  • Still, other realtors may only earn commission after an appraisal comes back with a value for your home that’s within 2-3% of what you’ve agreed upon selling it for (and yes, your real estate professional will want proof of this appraisal before disbursing any funds).

How much do real estate agents make per sale?

The short answer is 6% or a little less. The commission is typically divided into two parts: the seller’s agent, who provides services to the seller, and the buyer’s agent, who provides services to the buyer.

The commission on a property sale is usually split between agents based on how much time they spend selling it. Typically, an agent earns more if they sell more expensive homes in less time—but this isn’t always true! It depends on your market and how competitive it is for listings. If there are not many buyers looking at each property listed by agents in your area (and/or if there are lots of sellers), then agents won’t be able to charge high commissions because their time spent selling properties will be worth less than other markets where there aren’t as many listing opportunities available per month.


What percentage of each home sale does the seller pay?

When you sell your home, the buyer’s agent will take their percentage of the sale price from their commission. The seller pays for both agents’ commissions. The amount of money that an agent receives is usually between 3% and 6%. It depends on how much money the deal involves, but most buyers’ agents charge a flat 5% fee.


What happens to the commission if the deal falls through?

The agent only receives their commission if a property sale falls through. The buyer and seller are on their own to negotiate compensation for any expenses incurred during the contract period. 

Because real estate agents are paid based on commission, it is important that your contract with them clearly outlines what happens if you don’t close on your property or if there is some other unforeseen event that prevents you from purchasing or selling a home.


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How is the commission split?

The commission is split between the buyer and seller, depending on who you represent. If you are the listing agent, then the commission is split 50/50.

If you are a buyer’s agent, your client will pay 75% of their commission to you and 25% to their agent.

Finally, if you are a seller’s agent, your client will pay 25% of their commission to you and 75% directly to the listing agent (usually not involved in the transaction).


Once your transaction is finalized, you’ll have earned your commission.

The amount of the commission will vary based on many factors, including:

  • The complexity of the sale or purchase (such as if it involves a short sale or an estate)
  • How many agents are involved in the transaction

Generally speaking, however, real estate agents are paid a percentage (typically between 3-6%) of their client’s purchase or sale price. This means that if you’re buying a house for $100k and someone else is selling theirs for $200k, then each agent involved would receive 5% of their respective clients’ closing costs even though they both make considerably less than they could by doing transactions where they were paid by commission alone!


Join Young Real Estate offers 100% Commission Real Estate Plans

Paul Young, the founder of Young Real Estate, decided to go with multiple 100% structures. This structure enables realtors to be more successful and spend more time on lead generation, marketing, events, and professional development. We want your success. 

When our broker was thinking of different commission structures, he decided to create ones that would benefit him as a high-producing realtor and share them with their partners. When he had been closing on transactions by himself weekly, he realized it would make sense to come up with three 100% commission real estate plans and no additional fees!



So, the answer to this question is “when your transaction finalizes.” The final closing date for a home sale can vary from state to state and even by county or city. But once it’s over, you’ll have earned your commission. However, if you want to maximize your revenue and benefits while growing in the real estate industry, join Young Real Estate! Please choose one of our 100% commission real estate plans to start.


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