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Bright MLS Update to Listing Entry Cooperative Compensation Fields

Aug 4, 2023


Beginning on August 9, 2023, Bright MLS will update its Listing Entry system to allow for its users to enter any amount into the compensation field, including $0For REALTORS® concerned that this change will cause a ripple effect in the market, remember that until this update, Bright MLS allowed for offers of compensation as low as 1 cent. With the new update, all offers of compensation remain negotiable.

This is not the first time that the process of broker compensation has evolved; Buyer’s and Seller’s agents first began splitting commissions as far back as 1913 when the National Association of Real Estate Exchanges (now known as the National Association of Realtors®) issued the original Code of Ethics. At the time, the Code said that agents must “... always be ready and willing to divide the regular commission … with any member of the Association who can produce a buyer for any client.” Moreover, in the early 1900s, Sellers controlled most of the transaction, as Buyer’s agents worked as sub-agents to promote the Seller’s interests. Things began to change in the late 1980s, when brokerages started representing Buyers exclusively, a practice that continues today.  

Importantly, this update does not necessitate any changes to NVAR’s Standard Forms, as our Exclusive Right to Represent Buyer Agreement (K1338) states that “…in the event seller does not pay any or all of the amount due, Buyer hereby agrees to pay any and all remaining Broker’s Fee due to the Buyer’s Broker.” This provision allows for the Buyer’s Broker to be compensated by their client in the event the Listing Broker does not offer any cooperative compensation.

It is also possible for Buyer’s Brokers to be compensated by Sellers directly if mutually agreed to by the Buyer and Seller. This may be a solution for any brokers that represent VA Buyers, as fees or commissions charged by a real estate agent or broker in connection with a VA loan cannot be charged to or paid by the VA Buyer. However, while Buyers and Sellers can negotiate commissions directly, it is important for agents and broker to pay close attention to the ethical considerations associated with this practice.

To limit any perceived or actual REALTOR® Code of Ethics claims, below are some recommended best practices for negotiating commission payments into contracts between Buyers and Sellers:

  • Make sure that you have a written agency agreement in place that is signed by both parties prior to performing any real estate activities or beginning any negotiations;
  • Obtain your client’s informed consent prior to including this as a term of the agreement – let them know what options they have;
    • Buyer’s Agents and Brokers should clearly explain the terms of the buyer agency agreement to their clients – including who is responsible for what when it comes to commission payments;
    • Listing Agents and Brokers should clearly explain commission splits to their Sellers as soon as they are retained – ensure that clients understand that the amount of compensation they would pay does not change if any amount is also offered to a Buyer’s Broker;
  • Remember that the Buyer and Seller, not the agents or brokers, are the parties to the contract and can enforce the Residential Sales Contract;
  • Timing matters - it is best to negotiate the commission between the Seller and Buyer prior to showing the property or submitting an offer;
    • However, understand that even if the Seller refuses to negotiate on the commission, Buyer’s Agent or Broker must still promote the best interest of the Buyer, which may include showing the property, continuing negotiations with the Seller, etc.
  • If the commission is negotiated outside of the MLS, check with the lender to make sure the terms are approved;
  • Avoid encouraging Buyers to use the terms of an offer to modify or negotiate the offers of compensation or any part of the listing agreement – for example, do not waive a financing contingency in exchange for a higher commission split to the Buyer’s Broker;
  • Be careful initiating contact with the client of another REALTOR®, as that may subject you to the Code of Ethics.

In short, while it is possible to include language in an offer that allows Sellers to pay the Buyer’s Broker’s commission, agents and brokers should be careful to stay at arms-length from those negotiations.

For tips on how to demonstrate the value of a REALTOR® to clients, please visit

Read "Bright MLS Update to Listing Entry Cooperative Compensation Fields: The Ethical Point of View"

  • Compensation and Commission