So, you are looking to sell your home. One of the first things you will need to do is get yourself an agent. An agent is an exceptionally valuable commodity when it comes to selling your home. Not only can they list your property on the MLS and help generate interest on your home sale, but they can also help you choose a competitive but fair selling price, show people around your home and help you to negotiate that all-important sale on your behalf. These are just a few of the important services your agent can offer that will help take much of the stress and strain out the sale process.
In the past, all agents worked on a commission basis. However, now sellers also have the option of choose a flat fee and a fee for service agent. Let’s take a look at how these different agents operate and the distinctions between each of them and then conventional commission-based agents.
What is a flat fee agent?
A flat fee agent is a real estate agent who, rather than charging a percentage commission based on the sale price of your home, makes their services available for a flat fee.
What is a fee for service agent?
A fee for service agent in the real estate world is an individual that charges the client for specific selling or buying services on a service-by-service basis. This is in comparison to an agent who negotiates a percentage of the selling price for their fee.
What is the difference between a flat fee agent and fee for service agent?
The key difference between flat fee agents and fee for service agents is simply in how they market their services to you. Flat fee agents tend to create ‘packages’ of services, each sold for a flat fee. Buyers or sellers who opt for this pricing model can then enjoy all of the services offered within the fee they are prepared to pay. Unsurprisingly, the more services are included, the higher the fee you can expect to pay.
In comparison, a fee for service agent tends to form a ‘menu’ of services, where each is priced individually according to the amount of time the agent can expect to spend performing them. Simple services such as listing your property on the MLS may be fairly inexpensive, while more complex and/or time-consuming services such as negotiating terms with a prospective buyer or seller may be more costly.
How much money could I save by choosing a flat fee or fee for service agent instead of a traditional, commission-based real estate agent?
Exactly how much money you could save by choosing a flat fee or fee for service real estate agent of course depend on your individual circumstances. In most conventional real estate transactions, the seller pays the agent between 1 and 3% of the selling price as commission for selling their home. This is of course in addition to the 2 to 3% commission you will pay the buyer’s agent. Unfortunately, this latter cost will be payable regardless. However, you could potentially save thousands of dollars by opting to settle on a flat fee or fee for service agent.
For example, if your home sells for $300,000 and you must pay a 1% commission you will need to pay a conventional agent then you will need to pay a fee of $3,000. Of course, if the commission charged by a conventional selling agent is closer to 3%, you could expect this fee to triple. The more your home sells for, the more commission you can expect to pay.
If you are interested in finding out more about the benefits of a flat fee service for selling your home, please don’t hesitate to get in touch with our experienced and professional real estate team by calling 210-598-7500 today.