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Opinions about real estate rebates will get a hot discussion going among realtors. It’s understandable why some agents would reject a practice that lowers commission. However, rebates are used as a strong marketing tool and are quickly growing more popular. In fact, the Department of Justice believes that the ability to offer buyers a rebate is so important to competition and lower market prices that it is attempting to repeal anti-rebate laws in all states. Sounds juicy, right? Here are all the basics about the real estate bonus we like to call the rebate.

The Rebate

In most areas, the commission is paid by the seller, even if a buyer has an agent representing them in this real estate transaction. The rebate comes from this commission. There are cases where the rebate is quite a chunk of change---as large as one-third of the buyer agent’s commission.

Since real estate commission is entirely negotiable, it’s easier for sellers to lower the listing fee so the rebate is built in and then it can be offered to sellers in any of the fifty states. It is not taxable and is credited at closing, so there are no strikes against a buyer for receiving a rebate. They can just walk away with more bounce in their step and jingle in their pocket.

There are two ways to approach the rebate:

Rebates For the Deal Seeker

Some brokerages offer the rebate with all the standard real estate services included. This is a pure marketing strategy. And a golden one, assuming the brokerage can still rake in a profit with a lower gain on the buyer’s side of the transaction.

What is there for an agency to gain by offering a real estate rebate? Well, if the brokerage has a large inventory of listings, buyer rebates can bring more buyers and increase revenue. If an agent connects buyers with another listing offered by their brokerage, the brokerage is handling both sides of a dual agency.

Rebates For the Independent House Hunter

With the internet brings huge amounts of listings and information to buyers. Many of them go online to find the property they want. At the very least, a buyer can do the preliminary stages of house hunting by viewing properties online, watching virtual tours, and cruising by the property on their own.

Some brokerages are offering rebates to these buyers. They don’t provide an agent to accompany them to showings, so the clients rely on the listing agent and open houses. Additional showing services can usually be purchased separately if the buyer can't find a way in on their own.

The Only Catch

Not all agents can or will offer rebates. Real estate agents are licensed under real estate brokers. Both the broker and the agent must agree to offer the rebate. If the broker doesn't allow the rebate, then none of the agents under that broker can provide a rebate. So, even if you’re buying in a state that allows rebates, you must also find an agent that agrees to the rebate as well. Your best bet is to look for an agency that advertises the best real estate agents with commission rebates.  

Real Estate fees shouldn't have to be expensive. That's why we created Clever. With or without a rebate, Clever will match you with a top-rated local agent for a fraction of the price. Call us today at   1-833-2-CLEVER or fill out our online form to get started.


Andrew Schmeerbauch
Andrew Schmeerbauch

Andrew Schmeerbauch is the Director of Marketing at Clever Real Estate, the free online service that connects you top agents to save on commission. His focus is educating home buyers and sellers on navigating the complex world of real estate with confidence and ease. Andrew has worked on projects for the United Nations and USC and has a particular passion for investing and finance. Andrew's writing has been featured in Mashvisor, L&T, Ideal REI, and Rentometer.

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