New Realtor Law: Buyer Agreements, MLS Commissions, and Fees

The new Realtor law that took effect on August 17, 2024 changed three things about buying and selling a home in the United States: buyers must sign a written agreement with their agent before touring a property, buyer-agent commission offers no longer appear in the Multiple Listing Service (MLS), and every commission rate is openly negotiable between agents and their clients. The changes come from a nationwide settlement by the National Association of Realtors (NAR), and they apply to any agent working through an MLS connected to NAR systems, not just NAR members.¹

Why the Rules Changed

A group of Missouri home sellers sued NAR in Burnett v. National Association of Realtors, arguing that NAR’s cooperative compensation rules forced them to pay inflated commissions. Listing agents were required to offer buyer-agent compensation through the MLS as a condition of listing a property, which the plaintiffs said discouraged competition and kept fees artificially high. A federal jury sided with the sellers, and NAR agreed to a nationwide settlement rather than face further litigation. Every MLS in the country has since updated its platform to comply with the new rules.¹

Written Buyer Agreements Before Any Tour

If you want an agent to show you a home, you have to sign a written buyer agreement first. The rule covers in-person showings and live virtual tours, and it takes effect the moment you and your agent walk into a property together. The paperwork has to be done before the first door opens.²

The agreement must contain three specific items:

The compensation your agent will earn, stated as a dollar amount, percentage, hourly rate, or other figure that is clear and calculable. It cannot be left open-ended or tied to whatever a seller happens to offer.
A statement that the agent cannot receive compensation from any source that exceeds the amount in the contract.
Conspicuous language stating that broker commissions are not set by law and are fully negotiable.

The settlement doesn’t dictate how long the agreement lasts, whether it’s exclusive, or what specific services the agent must provide. Those terms are up to you and your agent, so you can negotiate a short-term agreement that covers a single property or a single zip code rather than a months-long exclusive.³

The Open House Exception

You don’t need a signed agreement to walk through an open house or to call an agent and ask about their services. The requirement only applies when an agent is actively touring you through a property. Browsing open houses on your own is still paperwork-free.⁴

Commission Offers Are Off the MLS

The MLS no longer displays what a seller is willing to pay a buyer’s agent. The old compensation field is gone, and so is the ability to filter or sort listings by commission level.²

The ban covers the whole MLS platform, including agent-only remarks and metadata. Agents cannot slip compensation information into a private notes field or any other workaround within the listing system. An MLS may include a general seller-concessions field, but if it does, the field must be available for all property types and all types of concessions, not just buyer-agent compensation.²

Negotiating Your Agent’s Fee

Agent fees have always been technically negotiable, but the old system made that easy to ignore. Sellers listed homes with built-in buyer-agent commissions, buyers never saw a bill, and 5–6% total commissions became the default. The new rules push the fee conversation into the open. The current average buyer-agent commission sits around 2.8%, though that varies widely by market and by the services you need.

Your agent’s compensation can be structured several ways:

A percentage of the purchase price, still the most common structure.
A flat fee, sometimes with optional add-on services for things like negotiation support or closing coordination.
An hourly rate, less common but available, especially for buyers who want limited help with specific tasks.

Once you sign, the compensation figure becomes a hard ceiling. Your agent cannot collect more than that amount from any source. If a seller offers a concession larger than what your agreement specifies, the agent cannot pocket the difference.² Ask what services are included at the quoted rate before you sign; a higher-rate agent who handles everything through closing can be a better value than a cheaper one who hands you off halfway through.

How Sellers Can Still Pay the Buyer’s Agent

The settlement did not ban sellers from paying buyer-agent compensation. It only banned advertising that compensation on the MLS.²

Off-MLS communication is still allowed. A listing agent can post compensation offers on the brokerage’s own website, send emails to buyer agents, or share the information by phone. The restriction is that the offer cannot flow through the MLS or any MLS-connected platform.²

The other common path is to negotiate it into the purchase offer. When you submit an offer, you can ask the seller to pay your agent’s fee as a concession. The seller can accept, reject, or counter that request like any other term. In competitive markets, many sellers are still covering buyer-agent fees because it attracts more offers by reducing the buyer’s out-of-pocket costs.

Listing agents must get the seller’s written approval before any compensation is offered or paid to a buyer’s agent.²

What VA and FHA Borrowers Should Know

Government-backed mortgages add a practical wrinkle. Both VA and FHA loans have rules about what buyers can finance, and buyer-agent commissions cannot be rolled into the loan amount under either program.

VA Loans

Veterans can pay their buyer agent’s fee directly, but the payment must come as cash at closing. You cannot add it to your VA loan balance. If the seller covers your agent’s commission, it is treated as a cost of sale and does not count toward the VA’s 4% seller concession cap. That means a seller can offer standard concessions for closing costs and still cover your agent’s fee on top of that without hitting the limit.

FHA Loans

FHA guidelines allow seller concessions up to 6% of the purchase price. Seller-paid buyer-agent commissions generally are not counted against that limit. As with VA financing, you cannot add the buyer-agent fee to your FHA loan balance. If the seller declines to cover it, you need the cash on hand at closing.

For either loan type, factor the commission into your cash-to-close budget from the start. Your lender will verify you have enough liquid assets to cover the fee alongside your down payment and other closing costs.

Buying Without an Agent

Nothing in the new rules requires you to hire a buyer’s agent. You can represent yourself, make offers directly to listing agents, and negotiate your own deal. If you do, the listing agent should provide a disclosure making clear they represent the seller and cannot give you advice during the transaction.⁴

Going unrepresented saves you the agent’s fee, but the tradeoff is real. A listing agent’s legal duty runs to the seller. They will not flag problems with an inspection report, advise you on pricing, or tell you the seller might accept less. In straightforward transactions in a familiar area, self-representation can work. In deals with contingencies, repairs, or competitive bidding, the cost of mistakes often exceeds the fee.

Some buyers hire an agent for limited services at a reduced fee, such as reviewing the purchase contract and attending closing, while handling the search and initial negotiations themselves. The flexibility in the new buyer agreements makes that kind of arrangement easier to structure than it was under the old system.

Checking Commissions at Closing

Whoever pays the buyer agent’s fee, the amount must be itemized on the closing documents. The settlement statement breaks down every dollar changing hands, including agent commissions on both sides. Your lender’s Closing Disclosure will also reflect these costs. Before signing anything, compare the commission figures on those documents against what your buyer agreement specifies. If the numbers don’t match, raise it before you sign, not after.

1
National Association of REALTORS. National Association of Realtors Provides Final Reminder of August 17 NAR Practice Change Implementation
2
National Association of REALTORS. NAR Settlement FAQs
3
National Association of REALTORS. Written Buyer Agreements 101
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National Association of REALTORS. What the NAR Settlement Means for Home Buyers and Sellers