Giving part of commission to buyer..?

Question

Redfin gives a portion of their commission back to their customers (Buyers). Could a regular referral agent do the same? Or would I have to be a brokerage?

James Wise · Answer

You don't want to compete like that. You will only attract the worst penny pinching buyers out there who will never respect you or your time. Spend the additional time & money you would be spending on driving around cheapo buyers who will be getting part of your commission on your marketing & continuing education to attract better clientele. In the long run you will make so much more money & do so on your own terms.

Jake Alger · Answer

I agree with @James Wise, you don't want to compete like that.

I've always been an advocate for quality over quantity and Redfin is purely the latter.  Put it this way, and this isn't to knock them in any way, I'm a broker in the Seattle area.  Our market is insanely hot right now.  We don't have expired listings or cancellations hitting the market like we would normally.  If you see one, it's like seeing a unicorn.

My point is, the expires or cancellations that I'm seeing when they do occur, almost always say "Redfin."

Cut rate prices will almost always yield cut rate service.

Now, aside from that, if you're looking to kick in commission because it's a friend, family member, etc. you definitely can.  Check with the lender and escrow company to find out what the caps.

Phil G. · Answer

@Brandon Stewart

If I understand your situation, you are referring someone to another agent who will represent the buyer?

If so, you cannot rebate the buyer.  You can, however, make it part of your referral agreement.  For example, you get 20% of the buyer agent commission and they agree to rebate 5% of the commission to the buyer.  The rebate must be listed on the CD by the buyers agent.

Rebates are legal in most, but not all states:

https://www.justice.gov/atr/rebates

Giving part of commission to buyer..?

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