Under the rules that took effect on August 17, 2024, the buyer is contractually responsible for paying their own agent, but in most transactions the seller still covers that fee through a concession the buyer negotiates into the purchase offer. So the honest answer to who pays the buyer’s agent is: both, in a sense. The buyer signs the agreement that sets the fee and owes it by default, and the seller is usually the one whose money actually funds it at closing. The average buyer’s agent commission currently sits around 2.4% of the purchase price, which on a $400,000 home works out to roughly $9,600.
Why the Question Changed in 2024
Before August 17, 2024, sellers almost always paid both agents through the listing agreement, and buyers rarely thought about the cost. The National Association of Realtors settlement resolved antitrust lawsuits alleging that the old system inflated commission rates, and it produced two structural changes.
First, the Multiple Listing Service can no longer display offers of compensation to buyer’s agents. Sellers can still offer to cover a buyer’s agent fee, but they have to communicate that through their own marketing, direct conversations, or listing agent outreach rather than through the MLS.1National Association of REALTORS®. Communicating Offers of Compensation Your agent may need to call or email the listing side before every showing to find out whether commission help is on the table.
Second, every buyer must sign a written representation agreement before touring homes with an agent. That agreement names a specific compensation amount, and the buyer is legally on the hook for it.
The Buyer Agreement Makes You the One Responsible
The written buyer agreement is now the document that governs what your agent earns. It has to state a definite amount: a flat dollar figure, a percentage of the purchase price, or an hourly rate. An open-ended “whatever the seller offers” is not permitted. The agreement must reflect what you and your agent actually negotiated, and you should not sign anything that doesn’t match your understanding of the deal.2National Association of REALTORS®. Consumer Guide to Written Buyer Agreements
Agents are also required to disclose conspicuously that compensation is not set by law and is fully negotiable.3National Association of REALTORS®. NAR Settlement FAQs Many buyers assume commission rates are standardized. They are not. If an agent presents 3% as a standard rate, you can propose 2% or a flat fee. The agreement is a negotiation.
Pay attention to duration and termination provisions. These contracts have an expiration date, and many include a notice period or early termination fee. A reasonable agreement protects both sides without trapping you.
How the Seller Usually Still Ends Up Paying
In practice, most transactions still result in the seller covering the buyer’s agent fee. The mechanics just look different. Instead of being preset in the MLS, the buyer’s offer now includes a request for a seller concession specifically earmarked for buyer’s agent compensation. If the seller agrees, the payment flows through closing the same way it used to, deducted from the seller’s proceeds and shown on the Closing Disclosure.4National Association of REALTORS®. TRID Closing Disclosures Summary
Nothing is automatic, though. A seller fielding multiple offers has little reason to agree to pay your agent’s fee. A seller sitting on a stale listing for 90 days has plenty of reason. Your leverage depends on market conditions.
One guardrail worth knowing: your agent cannot accept compensation from any source that exceeds the amount in your buyer agreement.5NAR.realtor. Compensation, Commission and Concessions If you agreed to 2.5% and the seller offers a 3% concession toward your agent, the extra half-percent doesn’t go to the agent. And seller concessions cannot be conditioned on using or paying a buyer broker, so the seller can’t force you to funnel a credit to your agent instead of applying it to other closing costs.
When the Buyer Actually Pays Out of Pocket
You end up paying your agent directly in three situations: the seller refuses to contribute, the seller agrees to less than your agreed fee, or your loan program’s concession cap blocks the full amount from flowing through closing.
In competitive markets, some buyers are choosing to absorb the commission themselves to make their offers more attractive. If you’ve committed to a 2.5% fee in your buyer agreement and the seller won’t budge, that cash comes out of your pocket at closing on top of your down payment. Across all major loan types, buyer agent commissions cannot be added to the loan amount. This is the single most important financial detail buyers overlook in the new system.
Loan Program Caps That Can Push the Bill to You
A seller concession covering your agent’s fee counts toward your loan program’s cap on interested party contributions. If you’re already using seller credits to cover appraisal fees, title insurance, or prepaid taxes, adding the agent’s commission on top could push you past the limit.
Conventional Loans (Fannie Mae)
Fannie Mae caps total seller concessions based on loan-to-value ratio:
- More than 90% LTV: 3% of the sale price or appraised value, whichever is lower
- 75.01% to 90% LTV: 6%
- 75% or less LTV: 9%
Any concession amount over the limit gets treated as a price reduction, forcing the lender to recalculate loan-to-value. For a buyer putting down 5% on a $400,000 home, the 3% cap means only $12,000 in total seller concessions, and that has to cover all closing costs, not just the agent’s fee.6Fannie Mae. Interested Party Contributions (IPCs)
FHA Loans
FHA allows up to 6% of the sale price in total seller concessions regardless of down payment. That ceiling still needs to cover everything the seller is contributing toward your costs.7FHA.com. FHA Seller Concession Rules and the Six Percent Limit
VA Loans
VA loans are a special case. Federal regulation historically prohibited veterans from paying real estate brokerage fees. After the NAR settlement, the VA issued a temporary variance letting veterans pay buyer-broker charges directly, provided the fees are not rolled into the loan amount and the veteran has enough cash to close after paying them. The variance remains valid until rescinded, with no announced expiration date.8Veterans Benefits Administration. Circular 26-24-14 – Temporary Local Variance for Certain Buyer-Broker Charges Sellers can still pay the buyer’s agent fee on VA transactions, and in practice that remains the most common arrangement.
If You Pay the Commission, It Adds to Your Tax Basis
If you end up paying your agent’s commission yourself, the IRS lets you add that cost to your home’s tax basis. A higher basis reduces the taxable gain when you eventually sell. The IRS treats commissions paid at purchase the same way it treats other settlement costs like recording fees and transfer taxes: they become part of your original cost.9Internal Revenue Service. Publication 551 (12/2025), Basis of Assets
If you buy a home for $400,000 and pay a $10,000 buyer’s agent commission, your cost basis starts at $410,000. When you sell years later, you subtract that figure (plus any capital improvements) from the sale price to calculate your gain. That extra $10,000 in basis could save you $1,500 or more in capital gains taxes depending on your bracket. Keep your closing documents and the buyer representation agreement as proof.
Keeping Your Share of the Cost Down
Negotiate the rate before you sign. Most buyer’s agents will discuss their fee, and the post-settlement environment has made that conversation more common. A straightforward purchase in a market you know well may justify a lower percentage or flat fee. A complex relocation or a first-time purchase with heavy coaching may justify more.
Build the concession request into every offer. Asking the seller to cover your agent’s fee is now a standard part of the purchase contract. Some sellers price their homes with the expectation that they’ll contribute. Others won’t. You lose nothing by asking, and in most transactions the seller still ends up covering it because it keeps the deal moving.
Watch the math on concession limits. If you’re putting down less than 10% on a conventional loan, the 3% cap gets tight fast. Work backward from the cap: figure out your total closing costs first, then see how much room remains for the agent’s fee. If the numbers don’t work, you may need to negotiate a lower agent rate, bring extra cash, or look for listings where the seller is already advertising commission coverage through their marketing.