Who is typically responsible for paying the broker's commission in a real estate transaction?

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In most real estate transactions, it is typically the seller who is responsible for paying the broker's commission. This fee is generally outlined in the listing agreement that the seller signs when hiring a real estate agent to market and sell their property. The commission is often a percentage of the final sales price and serves as compensation for the services provided by the broker, including marketing the property, negotiating with buyers, and handling administrative tasks throughout the transaction.

While the buyer may also incur additional costs in the transaction, such as closing costs or fees related to financing, it is customary for the seller to cover the commission fees associated with both their own broker and often the buyer's broker as well. This arrangement is beneficial for buyers since it allows them to engage a broker without directly paying for their services, as the costs are generally factored into the sale price of the property.

Other options like the buyer, both the buyer and seller, or the lender don’t usually bear the responsibility for the broker's commission in the typical real estate market setup. These roles may involve different responsibilities and financial obligations, but the seller usually takes on the commission payment as part of selling their property.

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