Real Estate Fees: Who Pays Them, the Buyer or the Seller?

Real Estate Fees: Who Pays Them, the Buyer or the Seller?

  • Heather Smith
  • 07/28/22

There are all sorts of fees that are associated with a real estate transaction—including the real estate agents’ commission and closing costs.

But who, exactly, is responsible for covering those costs; the buyer or the seller?

recent article from outlined who is generally responsible for real estate fees, including:

  • Real estate agent commission. While both the buyer’s agent and the seller’s agent generally make a commission off of the real estate transaction, those fees are almost always covered by the seller. The commission is typically subtracted off the proceeds due to the seller from the home sale.
  • Closing costs. Closing costs are additional fees that need to be paid at closing—including title company fees, loan processing fees, and any taxes or HOA fees that may be due. While there’s no set rule for who covers closing costs, generally, they’re split between the buyer and the seller—although, according to the article, buyers generally cover a larger portion (3 to 4 percent of the home’s sale price, compared to 1 to 2 percent for sellers).
  • Can you negotiate these costs? When it comes to real estate fees, you may have room to negotiate, whether you’re a buyer or a seller. For example, there’s no state or federal laws that set commission rates for real estate agents—so as a seller, depending on your situation and local market conditions, you may be able to negotiate a lower commission rate with your agent. From a buyer’s perspective, you may be able to negotiate with the sellers, and get them to cover some (or all!) of your closing costs.

Work With Heather

For most families, choosing a new home is the biggest financial decision they will ever make. There are many complicated decisions involved in choosing a home. As one of the top real estate professionals in the local market, I'll negotiate the best prices and terms for you and answer all of your questions as they arise.