The recent NAR settlement introduced material realtor compensation changes that affect how buyer agents are paid, how listings are shown, and how offers are structured. These changes are shaping negotiations on resale homes, shifting responsibilities for agent fees, and creating new paperwork requirements. This article breaks down the practical consequences, loan and MLS impacts, and how to navigate the new normal so you can make smarter decisions whether you are buying, selling, or representing clients.

Table of Contents

• Introduction
• How Buyer Broker Agreements Function Under New Realtor Compensation Changes
• MLS Rules, Advertising, and What You Can No Longer See Online
• Seller Concessions, Loan Rules, and Why the Math Changed
• What Realtor Compensation Changes Mean for Buyers
• What Realtor Compensation Changes Mean for Sellers
• What Realtor Compensation Changes Mean for Agents
• New Construction and the Carve-Out
• How to Navigate Realtor Compensation Changes: Concrete Strategies
• Checklist: Questions to Ask Before Signing Anything
• FAQs
• Closing Thoughts

Introduction

The core shift is simple to state and complicated to work through: sellers no longer publicly list a buyer agent commission in the MLS the way they used to, and buyer agent compensation must be documented in a buyer broker agreement or, when offered by the seller, structured as a seller concession. This rule stems from a settlement addressing how commission information was handled and how some sellers claimed they were not informed that buyer agent commissions were negotiable.

That sounds like a small administrative tweak, but realtor compensation changes have ripple effects. They change how offers are written, how loans treat credits, how agents are paid when sellers do not offer a concession, and how buyers find and agree to representation. The net effect is the same money changing hands in many transactions, but the path and timing of that money have been altered.

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How Buyer Broker Agreements Function Under New Realtor Compensation Changes

One of the most visible outcomes of realtor compensation changes is that buyers who want to work with an agent will often be asked to sign a buyer broker agreement that spells out exactly how much the buyer agent will be paid. That agreement must specify a percentage or flat fee — for example, 2%, 2.5%, 3%, or a flat fee.

This matters for two reasons.

• If the buyer broker agreement sets compensation at a fixed amount, the agent cannot later accept a higher amount offered by the seller unless the agreement is formally changed. In other words, the agreement is binding on the compensation side.
• If the seller does not offer a buyer agent commission, the buyer broker agreement typically contains language that explains what happens next — often that the buyer will be responsible for paying their agent directly or through an arrangement built into the purchase contract.

Practically, this means buyers should read and understand the buyer broker agreement before touring homes. Agents should be transparent about fees and the possible scenarios where a buyer might need to pay out-of-pocket or accept a reduced commission if a seller offers less than the contracted amount.

MLS Rules, Advertising, and What You Can No Longer See Online

Prior to these realtor compensation changes, the MLS displayed a specific buyer agent commission field. That made it easy for buyer agents to filter listings and for sellers to pre-offer compensation to help attract agents and buyers. After the settlement, most MLS systems removed the explicit commission field and restricted references to buyer compensation in listing remarks and public platforms like Zillow.

Some MLS systems still allow a simple check box indicating a seller is willing to pay buyer concessions, but the specific percentage or dollar figure often cannot be posted in the MLS remarks. That change reduces transparency in the listing feed and shifts some negotiation into back-and-forth conversations between listing agents and buyer agents.

Seller Concessions, Loan Rules, and Why the Math Changed

Under the new structure, buyer agent compensation offered by the seller typically becomes a seller concession, also known as a seller credit. Instead of showing up as a line item labeled "buyer broker commission" coming out of the seller's proceeds, the payment appears as a credit to the buyer on the closing statement.

That sounds cosmetic, but loan underwriters treat concessions differently depending on the loan type and the size of the contribution. Some loan programs have limits on seller credits. In some cases, the VA program initially had trouble accommodating commissions shown as buyer credits. Appraisal and underwriting rules may require adjustments so that seller credits used to pay agent fees do not exceed loan program caps.

When seller credits are factored in, the purchase price, loan amount, and the seller's net proceed calculations all shift. Buyers and sellers need to understand how a credit affects the buyer's loan qualification (does it reduce the cash the buyer needs today?) and the seller's net after closing. Agents must factor these changes in when advising clients on pricing, concessions, and negotiation strategy.

What Realtor Compensation Changes Mean for Buyers

Buyers lose some of the implicit safety net that used to exist. Previously, a buyer could work with an agent and expect the seller to cover the buyer agent commission as part of the sale. Under the realtor compensation changes, that expectation is no longer automatic.

• First-time buyers and buyers with tight cash reserves can be particularly impacted. Many cannot pay a buyer agent out of pocket, and many loan programs limit how much in seller credits can be applied.
• Buyers who want full representation should be prepared to sign a buyer broker agreement that spells out fees and to discuss what happens if the seller declines to offer a concession.
• Buyers should ask their lenders how seller credits applied to agent compensation affect loan qualification and whether specific loan programs permit those credits.

If sellers do not offer a buyer credit, buyers must either cover that fee, negotiate different terms, or potentially be represented under a new arrangement where the buyer pays the agent directly. That reality makes financial planning and candid conversations with your agent essential early in the process.

What Realtor Compensation Changes Mean for Sellers

Sellers may think realtor compensation changes create immediate savings because commissions are no longer posted the same way. In reality, the market mechanics still favor seller paid buyer compensation in many situations.

• Sellers who list without offering buyer compensation may reduce the buyer pool and lose first-time buyers who cannot pay an agent fee themselves.
• Sellers who want strong exposure and multiple offers often still offer a buyer concession to attract more buyer agents to show the home and present offers. More showings usually translate into stronger demand and higher final sale prices.

Smart sellers will weigh the potential net gain from getting more offers against the cost of offering a buyer credit. In a competitive market, offering buyer compensation is still a standard strategy to maximize exposure and final price.

What Realtor Compensation Changes Mean for Agents

Agents now have more paperwork and must be more deliberate about compensation agreements. Buyer agents will ask buyers to sign buyer broker agreements that detail compensation amounts. Listing agents must carefully communicate seller options because the MLS no longer displays buyer commission amounts in plain text.

Agents also need to negotiate all terms of the offer, including compensation, just like price, inspection repairs, and closing timelines. That requires clear client education: both buyers and sellers must understand how commissions fit into the larger offer strategy. Agents who explain the trade-offs will be more effective at getting deals done.

New Construction and the Carve-Out

One major practical exception to the immediate impact of realtor compensation changes is the new construction market. Builders often maintain established cooperative relationships with brokerages and continue to compensate buyer agents for bringing purchasers to model homes.

For most big builders, it is business as usual. Builder-paid compensation remains a common practice because builders benefit from agents who bring ready buyers and help close deals. If you are shopping new construction, confirm agent compensation with your agent beforehand, but expect that many builders will still offer standard compensation to buyer brokers.

How to Navigate Realtor Compensation Changes: Concrete Strategies

Whether you are buying, selling, or representing clients, these tactical steps help you adapt to realtor compensation changes.

• For buyers: Sign the buyer broker agreement only after you understand compensation terms and lender impacts. Ask your lender how seller credits used for agent payment affect your loan. If you cannot pay an agent, insist sellers include a buyer concession or choose communities or builders known to pay buyer broker compensation.
• For sellers: Treat offering buyer compensation as a strategic marketing expense. If you want multiple offers and broad exposure, consider offering a buyer concession in line with market standards. Don’t broadcast your exact bottom-line commission strategy to buyer agents during initial outreach; let offers compete and let agents reveal their best terms in the offers.
• For agents: Use clear buyer broker agreements and ensure clients understand when commissions will be paid and how. Negotiate compensation as part of the offer package. When listing, explain to clients that offering buyer compensation typically increases buyer traffic and may produce a higher sale price.

Practical negotiating tip: avoid publicly declaring the maximum buyer compensation you will pay before offers come in. Let buyer agents make offers based on what their client will pay for the property so you can compare overall net proceeds, not just commission percentages.

Real-world examples of the new math

Example 1: A house lists at $700,000. Seller previously would have paid 3% to seller agent and 3% to buyer agent out of proceeds. After the realtor compensation changes, the listing may not display the buyer agent commission. If the seller offers a 3% seller concession to cover the buyer agent fee, that concession must comply with the loan program and will be visible as a buyer credit at closing.

Example 2: A first-time buyer with limited cash needs an agent. The seller chooses not to offer a buyer concession. If the buyer broker agreement requires the buyer to pay 2.5% and the buyer cannot afford this, the buyer may need to find a different property, negotiate for seller credits, or accept representation under a limited service or lower-fee arrangement.

Timeline and what to expect next

Expect a transitional period as lenders, MLSs, and agents adapt. Some loan programs may update guidelines to accommodate seller credits used for agent compensation. MLS systems will continue to tweak how concessions are displayed, and agents will develop best practices for disclosure and negotiation.

Over time, realtor compensation changes will settle into a pattern. Many agents predict that within a year the market will have new norms: buyer broker agreements will be standard, sellers will understand the market cost of offering buyer credits, and loan systems will adapt to the revised flow of funds.

Checklist: Questions to Ask Before Signing Anything

• Buyers: Does the buyer broker agreement require me to pay my agent if the seller does not offer a concession?
• Buyers: How does the lender treat seller concessions used to pay agent fees under my loan product?
• Sellers: Will offering a buyer concession increase the number of offers and my final sale price enough to offset the concession?
• Agents: Does my buyer broker agreement allow me to accept a higher seller-paid commission if the seller offers one, or is it fixed?
• Everyone: How will this concession be shown on the closing statement and in the net proceeds calculations?

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FAQs

Do sellers still pay buyer agent commissions?

Sellers can still pay buyer agent commissions, but the payment is often structured as a seller concession or credit to the buyer. The MLS no longer displays specific buyer commission amounts in many markets, so sellers must communicate compensation through offers or via their listing agents.

If I am buying, will my agent still be paid?

Yes, agents are still paid, but the mechanism may change. If the seller offers a concession, it is credited to the buyer and used to pay the buyer agent. If no seller concession is offered, the buyer broker agreement usually specifies how the agent will be paid, which can mean the buyer pays out of pocket or arranges other payment terms.

Can a buyer agent accept a higher commission than what the buyer broker agreement states?

No. If the buyer broker agreement explicitly states a compensation amount, the agent cannot later accept a higher amount from the seller unless the agreement is modified with the buyer’s consent.

Are there loan programs that do not allow seller credits for agent fees?

Some loan programs have limits on seller concessions, and certain loan types may have restrictions that make using seller credits for agent fees more complicated. Buyers should consult their lender to confirm whether the intended loan product allows seller credits applied to agent compensation.

Does this change affect new construction purchases?

Most large builders continue to pay buyer agents as part of their long-standing practice. New construction has largely remained business as usual, with builders compensating buyer brokers to bring clients to the model homes.

What should sellers do if they want wide exposure but want to minimize costs?

Sellers should ask their listing agent to model scenarios: projected net proceeds versus buyer traffic with and without a buyer concession. Often the increased exposure and competitive offers generated by offering compensation outweigh the nominal cost of the concession.

Closing Thoughts

Realtor compensation changes have reshaped how commissions are displayed and documented, but they have not eliminated the incentives that drive agents to show and sell homes. The tools have changed — buyer broker agreements, seller concessions, and MLS restrictions — but the underlying dynamics remain: exposure drives demand, and clear terms drive transactions.

Buyers, sellers, and agents who learn the new paperwork, communicate clearly, and strategize around seller concessions will continue to close deals successfully. Adaptation will take time, but with the right questions and a plan, you can navigate the transition and still get the results you want.

If you need help buying a home, contact me at (925) 922-3901  or book a 15-minute strategy call and we'll get you started.

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