Buying a house is probably the most expensive thing you'll ever do. It’s stressful. You’re looking at interest rates, property taxes, and whether that weird stain in the basement is just water or a portal to a nightmare. But then there’s the question of the commission. Historically, if you asked when buying a home who pays the realtor, the answer was easy: the seller.
That’s basically ancient history now.
The real estate world got hit by a massive legal earthquake over the last few years, specifically the National Association of Realtors (NAR) settlement. If you’re browsing Zillow today, the old rules don't always apply. You can’t just assume your agent is "free" because the seller is footing the bill. Honestly, it’s a bit of a mess out there right now as everyone figures out the new normal.
The Old Way vs. The New Reality
For decades, the standard was a 5% or 6% commission. The seller paid it. That total was split between the listing agent and the buyer’s agent. Buyers loved this because they felt like they were getting professional representation for zero dollars out of pocket. Sellers hated it because they were losing a massive chunk of their equity to pay someone who was literally negotiating against them.
Then came the lawsuits.
Sellers argued that this system stifled competition. They won. Now, as of 2024 and heading into 2026, the way we handle when buying a home who pays the realtor has fundamentally changed. Listing agents can no longer advertise "buyer agent compensation" on the Multiple Listing Service (MLS). This sounds like a boring clerical change, but it’s actually a revolution. It means you, the buyer, have to have a very awkward conversation with your agent before you even see the first house.
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Who is Actually Cutting the Check?
It depends. I know, that's a frustrating answer.
There are now three main ways this plays out. First, the seller might still offer a "concession." They won't list it on the MLS, but your agent can call their agent and ask, "Hey, is your client willing to cover my 2.5% fee?" Many sellers still say yes because they want to move the house and they know buyers are already strapped for cash.
Second, you might pay it. If the seller says "no way," and you’ve signed a contract with your agent saying they get 3%, you are on the hook for that money at closing. This is a huge hurdle for first-time buyers who barely scraped together a down payment.
Third, you might split it. Maybe the seller covers 1% and you cover the rest. Or maybe your agent agrees to a flat fee instead of a percentage. The point is, everything is negotiable now. You aren't just a passive observer in the commission game anymore; you are a participant.
The Written Agreement You Have to Sign
You can’t even go on a tour with a Realtor anymore without signing a Buyer Representation Agreement. This is a law in most places now. Before this, you could wander through ten open houses with an agent and never talk about money. Not anymore.
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This contract must clearly state exactly how much the agent will be paid. It can’t be an "open-ended" amount. If the agreement says 2.5%, and the seller offers 3%, your agent actually can't keep the extra 0.5% unless you revise the contract. It’s all about transparency, but it feels a lot more corporate and rigid than it used to.
Why This Matters for Your Mortgage
When you're calculating when buying a home who pays the realtor, you have to think about your loan-to-value ratio. If you suddenly have to find an extra $10,000 or $15,000 to pay your agent, that’s money that isn’t going toward your down payment.
Lenders have specific rules about "interested party contributions." Basically, there’s a limit to how much a seller can pay toward your costs. For a conventional loan with 10% down, a seller can usually contribute up to 6% of the sale price. This is usually plenty to cover the agent’s fee and some closing costs, but you have to make sure the math works before you sign the offer. If the seller’s "help" exceeds the limit, you’re back to paying out of pocket.
Different Perspectives on the Change
Ask a long-time Realtor and they’ll tell you this is a disaster for fair housing. They argue that low-income buyers will be forced to go unrepresented because they can’t afford to pay an agent themselves. Without an expert, these buyers might miss structural red flags or get bullied in negotiations.
On the flip side, consumer advocates are cheering. They think fees have been artificially high for too long. Why should a buyer’s agent make $15,000 for showing three houses and filing some digital paperwork? In countries like the UK or Australia, fees are way lower. We’re finally seeing a push toward that kind of competitive pricing here.
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Negotiating Like a Pro
Since the seller isn't automatically paying, you have more leverage to negotiate with your own agent. You don't have to agree to 3%. You can ask for a flat fee. You can ask for an hourly rate, though that’s still pretty rare.
- Ask about "Dual Agency": In some states, one agent can represent both sides. It’s often a conflict of interest, but it can save money.
- Request Seller Credits: Instead of asking the seller to "pay the realtor," ask for a closing cost credit that covers the amount.
- Look at Discount Brokerages: Some companies offer a bare-bones service for a much smaller fee.
Real-World Example: The $400,000 House
Let’s look at a $400,000 home. Under the old system, the seller would pay $24,000 (6%) total. $12,000 went to their agent, $12,000 to yours.
Today, that same seller might say, "I'm only paying my guy $12,000. If the buyer wants an agent, they can deal with it." Now, you have to find $12,000. Or, you tell the seller, "I'll buy your house for $400,000, but only if you give me a $12,000 credit to pay my agent."
The net result for the seller is the same, but the way it’s structured on the paperwork is totally different.
What If You Go It Alone?
You could theoretically buy a home without an agent. You save the commission. But you’re also responsible for the contracts, the inspections, the title search coordination, and the brutal back-and-forth with the seller’s professional negotiator. For most people, that’s a recipe for a very expensive mistake. If you go this route, you should at least hire a real estate attorney to review the paperwork. They usually charge a flat fee (maybe $500 to $1,500) which is way cheaper than a commission.
Actionable Steps for Today's Market
Understanding when buying a home who pays the realtor isn't just about trivia; it’s about your bank account. If you’re starting your search, do these things immediately:
- Interview multiple agents. Don't just go with your cousin's friend. Ask them specifically how they justify their fee and if they are willing to negotiate their percentage.
- Read the Buyer Representation Agreement carefully. Look for the "term" of the agreement. Don't lock yourself into a six-month contract with an agent you might hate after one weekend. Try a "trial" agreement for 48 hours or for just one specific property.
- Talk to your lender early. Ask them, "If I have to pay my agent out of pocket, how does that affect my loan approval?" You need to know your "cash to close" number before you fall in love with a kitchen.
- Check the math on "Seller Concessions." When you make an offer, be explicit. If you need the seller to pay your agent, put it in the contract as a contingency.
The days of the "free" buyer's agent are over. Transparency is here, and while it’s more complicated, it ultimately gives you more control over where your money is going. Be prepared to talk numbers the moment you meet an agent, and don't be afraid to walk away if the fee doesn't match the value they provide.