However, buyers can save a huge amount of money as well. After all, the seller factors in commissions when they negotiate the selling price. So, it’s really a fact that the buyer is paying the commissions when they bring their money to the closing table. There are a few requirements in order to benefit from the consulting model when working with a buyer broker:

• The buyer must be serious about buying a property.
• Money is expended during the process, unlike the current percent-on-close model.
• The transaction should be large enough to generate desired savings.

If these conditions are present, a buyer will be refunded all of the consultant’s coop commission received from the seller broker at closing. Here’s how it works:

• Buyer pays for time showing properties.
• Buyer pays for consultant through process of negotiation and closing.
• Buyer is refunded the commission the broker receives at closing.

This isn’t for everyone, but it is logical, as it compensates the real estate consultant for their time and expertise. The client is rewarded with significant savings? How much? Here’s a possible example:

300,000 Land Purchase with 5% Coop Commission to Buyer Agent

That’s a commission amount of $15,000 that would go to Buyer Agent

Buyer spends $75/hour to be shown properties, average 8 hours or $600.

Buyer spends $100/hour for negotiation/transaction services to closing:
Average 30 hours or $3000, but capped at $4995

Cost to Buyer for 36 hours transaction + 8 hours showing = $4200

Buyer receives a credit refund at closing of the $15,000 commission

That’s $10,200 in the buyer’s pocket!