What Is a Discount Real Estate Broker?

Discount brokers offer lower commission rates to sellers, but vary in their fee structures and the range of services they provide.

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Updated · 3 min read
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Written by Taylor Getler
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Edited by Jeanette Margle
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Editor's Note: This article has been updated to reflect the outcome of a legal settlement involving commissions paid to real estate agents representing home buyers. Starting in August 2024, home buyers in most markets must sign agreements with their agents before touring homes, and buyers will set their agents' commissions through negotiation. See how this will affect home sellers and home buyers.

There is always a cost to selling your home, including the commission paid to your real estate agent.

While some listing agents might charge between 2% and 3% of the home’s sales price for their services, brokerages that promise to sell your home for significantly lower fees have become more popular in recent years. By understanding the nuances of what an agent at a discount real estate brokerage can offer you, you can decide if this path is right for you and your home.

What is a discount broker?

While real estate agents and brokers are similar, there are important distinctions. Real estate agents assist and guide their clients through buying and selling their homes, while brokers have undergone additional training and licensing that enables them to oversee other agents. Both agents and brokers can work for brokerages, though brokers can also work independently.

A discount brokerage uses the internet to connect sellers with agents willing to accept lower rates, usually in exchange for a larger volume of clients. The level of savings and the payment structure you can expect as a seller will depend on which brokerage you choose.

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