Working with a real estate agent: what they do, what they cost

Agent vs. broker vs. Realtor

The titles overlap and confuse new buyers. The plain-English version:

• Real estate agent — anyone with an active state real-estate license. To get one, they pass a state licensing exam and complete continuing education. Required by law to act in your interest if they represent you.
• Broker — an agent who passed an additional broker exam and can run their own brokerage. Many top-producing agents are also brokers.
• Realtor® — an agent or broker who is also a member of the National Association of Realtors (NAR). Realtors pledge to follow NAR’s Code of Ethics. Not all licensed agents are Realtors; not all Realtors are better agents.

What a buyer’s agent actually does

• Filters listings to your criteria

  Before MLS access was public, this was the bulk of an agent’s value. Today most buyers find homes themselves. Agents now add value mostly after the home is found.

• Schedules and runs tours

  Coordinates with listing agents, gets you into the home, points out things you’d miss, and helps you compare across multiple properties.

• Writes and negotiates the offer

  They know the local market — what offers actually win, what concessions sellers are giving, what contingencies are standard. The single biggest place an agent earns their fee.

• Manages the timeline

  Inspection, appraisal, financing, and contract deadlines all overlap. A good agent keeps everything on schedule and flags issues before they blow up.

• Coordinates with title, lender, and inspector

  They’re the air-traffic controller of escrow. When the appraiser is late or the title company finds an issue, your agent is the one chasing it.

• Walks you through closing

  Sits with you at the signing table, explains documents in real time, and is there to call out anything unusual.

How agents get paid (the 2024 changes)

For decades, the seller paid both their listing agent and the buyer’s agent — typically 5–6% of sale price split between them. The buyer never wrote a check. That changed in late 2024 when a settlement between the National Association of Realtors and class-action plaintiffs took effect nationwide.

The new model:

• Buyers must sign a written representation agreement before touring homes with an agent. This agreement spells out how that agent gets paid — including a specific percentage or flat fee.
• Buyer’s agent compensation is no longer required to appear on the MLS. It must be negotiated separately, either offered by the seller, paid by the buyer directly, or negotiated into the purchase contract as a seller concession.
• Buyers can negotiate the rate. Common ranges are 1.5–3% of purchase price, but it’s genuinely negotiable now. Some agents work for flat fees or hourly rates.

Questions to ask before you sign with an agent

• How many transactions did you close in the last 12 months?
• Do you specialize in this price range or neighborhood?
• What’s your typical buyer rep fee, and is it negotiable?
• What’s your typical communication response time?
• Will I work with you directly, or with a team member?
• How long is the buyer-rep agreement, and what happens if I want to cancel?
• Can you provide 2–3 recent buyer references?

How to find a good agent

• Referrals from people you trust

  A friend who recently bought is the best lead. They’ll be honest about whether the agent was responsive, calm under pressure, and a good negotiator.

• Agents your loan officer works with regularly

  Loan officers see agents in escrow every week. They know who hits deadlines and who doesn’t. They can’t legally steer you, but they can give you 2–3 names to compare.

• Track record over personality

  A great personality doesn’t close hard deals. Ask about their last 3 closings — what went wrong, what they did about it. Real war stories beat marketing language.

• Specialization matters

  Agents who do 5 first-time-buyer FHA deals a year know that lane. Agents who sell luxury homes don’t. Match the agent to your purchase profile.

Common questions