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Jordan Goodman is the author of Everyone's Money Book, available at 888-201-6300. This is the third edition of the book. You can also visit his Web site at www.moneyanswers.com. He talks with us on Thursday mornings.
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February 6, 2003
"Saving on Real Estate Broker Commissions"
 Listen
Traditionally, when you use a real estate broker to sell your home, you have
to pay a hefty 6% commission, which can amount to thousands, or even tens of
thousands of dollars. Real estate brokers have been very reluctant, if not
completely resistant, to cutting that commission, unless the commission
becomes the sticking point to making a deal go through -- in which case they
may split or reduce the fee a bit.
But now, that's all changing because of the Internet. A new breed of
Internet-based discount real estate brokers is charging much lower
commissions -- and, the Net brokers are promising to do just as good a job at selling your home.
They're now charging between 2% and 4%, which can save you
thousands of dollars if you end up selling for about the same price as
through a full-service broker.
In the past, the barrier against discount brokers was that they did not
have access to multiple listing services and other realtor databases of
homes for sale. But now, discount brokers are hiring local realtors that give
them access, so they have figured out a way around the access problem.
Traditional realtors are still resisting the idea of putting their multiple
listing databases on the Web, out of fear that people will see the address
for a listing and then have potential buyers walk up to the house to try
to make a deal directly with the seller. But it seems that traditional
brokers can’t hold back the forces of progress because other ways of
selling homes, such as eBay and other auction sites, are also becoming
popular.
So, if you want to sell your home, where should you look if you want to cut
the commission? Many brokers just specialize in a paticular local market,
and some offer national services. Here are some of the biggest discount
Internet real estate brokers:
For More Financial Tips From Jordan Goodman
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