Understanding Cooperative Compensation

Listing brokers can’t lower payments to selling agents after a purchase offer is made.

MARCH 2016 | BY Bruce Aydt Via Realtormag.org


Q. I am representing a buyer for a property listed in my MLS. The full-price offer my client submitted was countered, and the listing agent lowered the cooperative compensation listed in the MLS by half a percent. I made a copy of the MLS listing showing the cooperative compensation when the offer was first submitted. What is the rule on making changes to cooperative compensation after a purchase offer has been submitted?

A. Changes in cooperative compensation are covered by Article 3 and Standard of Practice 3-2. However, it’s worth keeping in mind that sharing commissions, as opposed to the details of cooperation, is not itself an ethical obligation. Article 3’s duty requires that “REALTORS® shall cooperate with other brokers except when cooperation is not in the client’s best interest. The obligation to cooperate does not include the obligation to share commissions, fees, or to otherwise compensate another broker.”