A Texas Real Estate Broker May Divide A Commission With
When it comes to the sale of a property, a real estate agent or broker is entitled to a commission for their services. However, in some cases, the commission may be divided among multiple parties. In Texas, the rules regarding commission sharing are governed by the Texas Real Estate Commission (TREC), which sets out specific guidelines for brokers and agents. In this article, we'll take a closer look at the circumstances under which a Texas real estate broker may divide a commission with another party.
Another Broker
One of the most common scenarios in which a Texas real estate broker may divide a commission is when they work with another broker. This may happen when a property is listed with one broker, but another broker brings in a buyer. In this case, the two brokers may agree to split the commission in a pre-determined manner, such as 50-50. This is known as a "co-brokerage agreement" and must be agreed upon in writing by both parties.
An Agent or Associate
A Texas real estate broker may also decide to share their commission with an agent or associate who works for them. This may happen when the agent or associate is responsible for some or all of the work involved in the sale, such as finding a buyer or handling negotiations. In this case, the broker and agent or associate must have a written agreement outlining the terms of the commission split.
A Referral Source
Another scenario in which a Texas real estate broker may divide a commission is when they receive a referral from another party. For example, a broker may receive a referral from a mortgage lender or an attorney involved in the sale. In this case, the broker may agree to pay a portion of their commission to the referral source, as a way of thanking them for their help. This must be agreed upon in writing and disclosed to all parties involved in the transaction.
Conclusion
As you can see, there are several circumstances under which a Texas real estate broker may divide a commission with another party. In all cases, it is important to have a written agreement in place that outlines the terms of the commission split. This helps to ensure that everyone involved in the transaction is aware of the arrangement and can make informed decisions. If you have any questions about commission sharing in Texas, it is always best to consult with a qualified real estate attorney or broker.