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As part of the National Association of Realtors’ (NAR) settlement, from 17th August, 2024, we have a new library of agreements and contracts for both sellers and buyers. So let me try to throw some light on the changes so you, as a client, can begin to understand what’s happening.
But first, please note well:-
- I am not a lawyer, so do not construe anything I write in this blog as legal advice or a legal interpretation.
- Commissions are and always have been negotiable and never set by NAR, Florida Realtors, Coldwell Banker Realty (CBR) or real estate law.
- Read all documents carefully before you sign anything so you are fully aware of the terms of, and your responsibilities under, the agreements and contracts.
- You should contact a real estate attorney if you have any questions, seek interpretation or need advice on CBR’s contracts.
The prime affect of the settlement is on the way commissions are dealt with between buyer and seller on the MLS – simply put, they are no longer disclosed. It is now prohibited to provide any commission information on the listing or to any syndicated service that pulls information from the MLS, like Realtor.com, Zillow et al. Brokers’ compensation cannot be divulged in ShowingTime or any other professional service connected with the MLS, even after a sale has closed. Direct negotiations between seller and buyer via their respective agents and brokers is now the necessary standard of practice to agree the commission splits – under the direction of you, the client.
For sellers – the Sellers’ Listing Agreement has changed primarily and clearly to define the commissions the seller agrees pay at closing, and to whom. PLEASE READ IT CAREFULLY AND CALL ME OR YOUR LAWYER IF YOU NEED HELP. Coldwell Banker Realty has its own approved series of contracts, addenda and amendment forms. Prior to these new contracts, sellers were expected to pay (for example) 6% commission at closing, and that amount was then split and paid by the closing agent to the listing broker and buyers’ broker, usually on a 50/50 basis. The new contract defines the percentages payable to both brokers.
For buyers – a Buyers’ Representation Agreement must be signed before an agent can show any residential property to any client. PLEASE READ IT CAREFULLY AND CALL ME OR YOUR LAWYER IF YOU NEED HELP. Coldwell Banker Realty has its own approved series of contracts, addenda and amendment forms. Buyers must now agree to pay a commission at closing to the buyers’ broker. If the seller has agreed to pay the buyers’ commission (as the practice was before) then there may be no (or partial) liability on the buyer to pay a commission at closing.
For both sellers and buyers – Coldwell Banker Realty has its own series of contracts, addenda and amendment forms that will address all arising situations. The riders can and will also be used to change the terms and details of the agreements so that there are no open questions or misunderstandings to get in the way of a successful closing. As always, these are legal documents that define both sides’ benefits, responsibilities and penalties; again, read them carefully and seek professional advice when you need it.
Bob Head | Coldwell Banker Realty | 30th August, 2024.
