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By Peggy Horn
contributing writer 

Real estate commissions


April 13, 2024

Uncertainty has rocked the real estate industry in recent weeks. Since the Sitzer-Burnett verdict, a pending settlement, which must be approved by a judge, will provide a path ahead for real estate professionals and their clients.

Instead of relying on a verbal conversation, a written agreement will now be required between a buyer and their real estate broker. This written agreement will be legally binding. It is designed to protect both the client, the broker and the real estate agent. This written agreement, called a Buyer Representation and Broker Compensation Agreement (BRBC) will outline the duties and responsibilities of all parties making the home buying process more transparent. For example, below are some of the duties of each party.


1. Shall provide accurate personal information regarding the financial ability to purchase real estate.

2. Shall advise the agent of any property in which the buyer may have an interest in potentially purchasing.

3. Shall read all documents provided.

4. Shall pay for investigations and reports desired regarding the property.

5. Shall submit any offer(s) through the buyer’s agent.

Buyer’s broker and agent

1. Search to locate a property that is within the specifications of the buyer.

2. Arrange showings of properties.

3. Disclose to buyer any known information that may affect the buyer’s decision to purchase the property.

4. Negotiate the purchase using their professional knowledge and experience.

5. Represent the buyer’s best interests.

6. Protect all confidential information that a buyer discloses to the agent.

The BRBC states that the “broker will devote time and resources to assist buyer in finding and acquiring [a property] in the expectation of being paid for broker’s services.” It also states that real estate commissions are not fixed by law. They are negotiable between the broker and the buyer.

It is important to understand two things: Although a buyer will sign an agreement to compensate their broker, the buyer may still ask the seller to pay for this obligation on their behalf. And, when negotiating a commission with an agent, it is important to keep in mind that it is the broker that the buyer is hiring. The agent is an independent contractor.

So to clarify: The litigation has caused a great deal of uncertainty in the real estate industry that has already been dealing with the effects of higher interest rates and low inventory. But, it also provides a pathway ahead for the industry and its clients.

Peggy Horn is the Office Manager at Coldwell Banker Frontier. She is happy to answer any questions you may have regarding the real estate industry. You can reach her at


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