Home > 2012 > Compliance Blog: Commission Continued

Compliance Blog: Commission Continued

Compliance Blog for CTMLS about CommissionIn recent months we’ve been discussing Commission and how it should be offered in the MLS. Today we’re taking a look at commission and how to remain within the CTMLS Rules and Regulations when discussing it in the MLS.

We are seeing the statement “if purchaser is a licensed Realtor, no commission will be paid” or similar statement(s) appearing in many listings lately. This statement is in violation of CTMLS Rules and Regulations.

CTMLS Basic Agreement and NAR MLS Policy state that entitlement to the cooperating broker commission is determined by the identity of the buyer agent who is the procuring cause of the successful transaction. There are no further qualifications or comments that can change these criteria.

If clients are asking for this language in the MLS listings, it is because they misperceive the function of the MLS. The MLS is about two things, cooperation and compensation. The MLS listing creates a compensation agreement between the listing brokerage and the cooperating brokerage. It does not create a compensation arrangement between the cooperating brokerage and the seller. The seller’s obligation is fixed by the listing agreement and not by what is set forth in the MLS. For this reason, clients are not permitted to provide language limiting or otherwise affecting the offer of cooperation and compensation set forth in the MLS.

Do you have questions about offers of compensation within the MLS? Ask them in the comments below and we will answer them here for everyone to see.

Posted in Compliance | Tagged , , | 4 Comments

4 Comments

  1. John Zubretsky
    Posted September 26, 2012 at 11:54 am | Permalink

    In the past we were counseled by Eugene Marconi to include language as follows when requesting the compensation in our buyer rep agreements – “Seller to pay x% of the sales price at closing to xyz agency to satisfy buyer’s obligation under their buyer representation agreement”
    Has CAR’s position changed?

    • Adam
      Posted September 26, 2012 at 4:31 pm | Permalink

      @John thank you for your comment, I would actually refer you to CAR for an answer on this one.

  2. Posted September 26, 2012 at 2:43 pm | Permalink

    If an offer of compensation is less than what is stated in a Buyer’s Agreement, and the Buyer does not want to make up the difference, can a buyer include and make part of their offer, an addendum requesting a Buyer-agent fee of XXX of the Seller?

    • Adam
      Posted September 26, 2012 at 4:35 pm | Permalink

      @Suzanne, I checked with our compliance department and they have referred you to CAR for this question. Thank you for your comment.

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