What Are "Selling Fees"?

Often in cities across the US, Realtors put up a sign in the yard of the home they intend to assist in selling...

That sign can contain information used to sell the home, and also to sell the agent or Realty Company. One of the "tricks" we've seen coming up from time to time is for an agent or agency put their fees right on the sign, so other potential-buyers and sellers will like their rates and call, potentially becoming a client. One of the numbers agents sometimes use is called a “Selling Fee”.

When anyone chooses a Minnesota Realtor, they sign a contract with all the specifics of the agreement: prices, length of contract, what will be done during that time, etc. - and that is the time the commission is negotiated as well (commonly 5% to 8% in total).

That 5-8% pays the agent bringing the buyer 2.7 to 3% usually and anything left over goes to the sellers agent and includes all marketing and expenses.

But some agents want you to believe that a “selling fee” is the same thing as the total-commission, and often they're not. If someone advertises they have a 4% selling fee to get your attention, but the buyer's fee is still 2.7 – 3%, that's no savings at all. The total commission is still between 6.7% and 7%.

So if you see an advertisement like that with a low percentage, make sure you ask what else you will have to pay for at close.

Better safe than sorry, right?!