Understanding why sellers sometimes agree to cover buyer agent commissions, how it affects home sale pricing, and what today’s real estate rules really mean.

Historical Background: How Buyer Agent Fees Used to Work

Historically, sellers paid their listing agent about 6% of the sale price to sell their home. The listing agent would then offer half of that to the agent who “brought” and represented the buyer.



This didn’t make sense for a lot of reasons — sellers were being forced to pay for someone else’s services, and buyers had no control over how their own agent was compensated.

Why the Lawsuit and Rule Changes Happened

These issues helped spark the major lawsuit and subsequent state law changes that now require buyer’s agents to have a direct agreement with their buyer clients. This agreement obligates buyers to pay their agent’s fees directly.



The old system, where buyers thought their agent was “free” because “the seller paid the buyer agent fees,” was misleading and unfair to both buyers and sellers. It created confusion and misaligned incentives that regulators have now tried to fix.

The Problem: Old Habits Still Persist

Unfortunately, despite the rule and law changes, things haven’t changed as much as intended.

Many agents still tell buyers, “Don’t worry, the seller will pay my fee,” without explaining that even if the seller agrees to pay the buyer’s agent fee out of their sale proceeds, the buyer is still effectively paying it because it reduces the amount of their offer.

Awareness is slowly improving, but the industry needs to continue to shift toward more transparent practices.

Why a Seller Might Still Agree to “Pay” the Buyer’s Agent

In any event, the reason a seller may agree to “pay” the buyer’s agent out of their sale proceeds is that it allows the buyer to use their loan to finance the agent’s fee instead of paying it in cash at closing.

For example:
If a buyer must pay a 3% buyer agent commission on a $1 million home, they’d need an extra $30,000 in cash at closing.

Instead, if they offer $1,030,000 and ask the seller to cover the buyer’s agent fee, the seller still nets the same proceeds — but the buyer doesn’t need that additional cash upfront.

This benefits the buyer, not the seller, but it indirectly helps the seller by enabling more potential buyers to make offers on the home, which can lead to a higher sale price.

Clarifying the True Cost: Is it a Cost to the Seller or Buyer?

Even if you as a seller agree to that arrangement, you’re not truly bearing the cost of the buyer’s agent commission. A better argument is that they buyer is bearing the cost of the buyer' agent commission as they are the only party bringing money to the table in the transaction.

A buyer who doesn’t have their fee “covered” would simply offer less on the house.

For instance, a cash buyer wouldn’t say, “I’ll pay you $1 million for the home but please also pay my buyer agent fee of $30,000.” They’d just offer $970,000 instead.

So, agreeing to “cover” the buyer’s agent fee mostly helps buyers using financing, since it lets them fold that cost into their loan instead of paying out of pocket. This can, in turn, give sellers access to a larger pool of qualified buyers with more available cash for down payments and closing costs.

Recommended Resources

"Who Are the Parties Involved in a Typical Real Estate Transaction"

"Steps to Buying a Home"