Selling Office Commission (SOC) Definition

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What is selling office commission?

The selling office commission(SOC) is the amount of commission a buyer’s agent receives after a successful sale of a property, according to broker trust. Real estate agents play an important role in real estate transactions. In other words, agents bring together buyers and sellers and facilitate the entire buying and selling processes.

Since real estate agents do most of the work, they get compensated through commissions. A commission is an amount of money an agent gets paid after a successful sale of a property. These commissions are usually a percentage of the total sale price. However, commissions can also be paid monthly as a salary.

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How does selling office commission work?

In order to sell a house, a seller will use a real estate agent (seller’s agent). The job of the agent is to bring a buyer and make sure that the house is sold at the best price possible. The seller’s agent will receive a commission which is most of the time a percentage of the entire sales price.

As noted by Realtor, a real state agent commission is between 5% to 6% of the final sale price. The seller will sign a contract that includes terms, conditions, and the commission that must be paid if the house is sold.

If the seller’s agent is lucky, he/she will sell the house without another agent. In this case, the agent becomes a dual agent and the entire percentage of commission will go to the seller’s agent team. Usually, seller agents work under a real estate firm that determines how much the agents take home in commissions.

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Where do buyer’s come from?

Without buyers, the sale will not happen. Buyers are usually brought by agents who will represent them for the entire house purchase process. These agents are known as buyer’s agents. In the beginning, we had one agent and a seller. Now, there are two agents (seller’s agent who represents the seller and a buyer’s agent who represents the buyer), the seller, and a buyer.

The buyer’s agent will earn a commission for bringing a buyer and contributing to the sale of the property. This commission earned by a buyer’s agent is known as a selling office commission.

NOTE: Sellers pay all commission unless there are other arrangements made between the buyer and seller.

After a successful sale, the commission will be shared between both agents. Most of the time, the commission is split in half between both agents. If the buyer’s agent is working under a real estate firm, the commission will be given to that firm which in turn will determine how much the buyer’s agent will take home.

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Who pays the commission?

Commissions are paid by sellers of properties. If there is one agent, the entire commission will go to that agent. On the other hand, if there are two agents (buyer’s agent and seller’s agent), the commission will split based on their agreements.

When proper arrangements are made, the buyer can contribute to the commission. A written and the signed agreement must be made. This agreement should include reasons a buyer is paying commissions and how much the buyer will pay.