As a real estate agent, you make money in the form of a commission once a sale or rental deal closes.
The commission usually equals a percentage of the purchase price, such as 5% or 6%.
The total commission will get divided between the seller and buyer's broker. The brokers will then share a percentage of what they earn with the salesperson who worked with them on the deal.
For example, let’s say you represent a buyer looking to purchase a new house. They make an offer on a $350,000 house, which is accepted, and you close on the deal a few weeks later.
If the commission of the deal was set at 5%, that commission will generally be divided in this way:
The seller’s broker will get 50% and the buyer’s broker will get 50%.
The total commission will be $350,000 x 5% = $17,500.
Your sponsoring broker will get half of that, or $8,750.
Your broker will then share a portion of his/her commission with you. Let’s assume you have a 60/40 split with your broker.
That means you will earn $8,750 x 60% = $5,250 on this single transaction.
Choose the answer by state?