Published October 10, 2026 · Recalde & Friedman, PLLC · For real estate agents
Four common structures
| Structure | How it's documented | On the Closing Disclosure |
|---|---|---|
| 1. Listing broker pays the buyer's broker out of the listing commission | A cooperative compensation agreement between the brokers, approved in writing by the seller as the 2024 rules require | Commissions are listed under "Other" (Section H), in the seller-paid column |
| 2. Seller pays the buyer's broker directly | A compensation agreement between the seller and the buyer's broker, or a contract rider such as Florida Realtors' Rider GG, which makes the contract contingent on that agreement | Section H, seller-paid, payable to the buyer's brokerage |
| 3. Seller gives the buyer a credit, and the buyer uses it toward the broker fee | A credit term in the contract, for example Florida Realtors' Rider FF (Credit Related to Buyer's Broker Compensation) | A "Seller Credit" to the borrower, and the broker fee shown as buyer-paid |
| 4. Buyer pays | The buyer agreement alone | Section H, buyer-paid, which adds to the buyer's cash to close |
What the federal rules say
- Real estate brokerage fees go under "Other" on the Closing Disclosure (12 C.F.R. § 1026.38(g)(4)). The official commentary says the amount shown must be the total paid to each brokerage as a commission, no matter who holds the deposit. Other broker charges, such as an administrative fee, are itemized separately with a description and the name of the payee (comment 38(g)(4)-4).
- A lump-sum seller credit is labeled "Seller Credit" (§ 1026.38(j)(2)(v)).
Many closing agents also prepare an ALTA settlement statement that shows each side's figures in more detail.
Why the structure matters to the lender
- Concession limits. Loan programs cap how much an interested party like the seller can contribute to the buyer's costs. In an April 2024 notice, Fannie Mae said a seller or the seller's agent paying the buyer's agent commission according to local common and customary practice doesn't have to be counted toward those limits (Fannie Mae Selling Notice). A credit the buyer uses toward the fee may be treated differently. Ask the loan officer before you write the offer.
- Financing the fee. NAR's FAQs say Fannie Mae, Freddie Mac and FHA don't allow commissions to be added to the loan balance.
- VA buyers. Under VA Circular 26-24-14, in effect since August 10, 2024 and valid until rescinded, veterans may pay reasonable and customary buyer-broker charges in some circumstances. The charges can't be included in the loan, and the lender must count them when checking the veteran's funds to close.
Put the same numbers everywhere
Most closing-table problems with buyer-broker pay come from documents that don't match. The buyer agreement says 2.5%. The rider says "seller to pay buyer's broker 2.5% of purchase price." The broker's instruction letter says $12,000. The lender approved a $10,000 seller credit. Each document may make sense on its own, but the title company can't prepare a statement that satisfies all of them.
Hypothetical
Send us the deal before it's signed
Compensation terms, credits and riders are easiest to fix while the offer is still a draft. Share the draft offer or the offer your seller received, and we can review the contract and addenda, check the compensation and credit terms against the lender's limits and the brokers' instructions, and run early title, lien and association checks.
Request a pre-contract reviewSend us the deal
Before we review a contract, we confirm in writing who we represent in the transaction.
Frequently asked questions
Is a seller-paid buyer-broker commission a seller concession for lending purposes?
Fannie Mae said in April 2024 that a seller or seller's agent paying the buyer's agent commission according to local custom doesn't have to be counted toward its interested party contribution limits. Treatment can differ by loan program and structure, so confirm with the lender.
Where do commissions appear on the Closing Disclosure?
Under 'Other' in Other Costs (Section H), showing the total paid to each brokerage. A lump-sum seller credit appears as 'Seller Credit.'
Can a VA buyer pay their own broker?
Under VA Circular 26-24-14, in some circumstances, yes. The charges must be reasonable and customary, can't be added to the loan, and count toward the veteran's funds to close.
Related articles
- Compensation Questions That Come Up in Contract Negotiation
- How Commissions Get Paid at a Florida Closing: Instructions, Splits and Referral Fees
- Written Buyer Agreements in Florida: What They Must Say Before the First Tour
- The Commission Rule Changes Since August 2024: A Florida Agent's Guide
Also useful: Agent resources · Escrow deposit disputes · Doc stamp calculator
- 12 C.F.R. § 1026.38(g)(4), (j)(2)(v) (Closing Disclosure: other costs; seller credit)
- 12 C.F.R. pt. 1026, Supp. I, comment 38(g)(4)-4 (real estate commissions on the Closing Disclosure)
- Fannie Mae, Selling Notice: Real Estate Commissions and Interested Party Contributions (Apr. 15, 2024)
- U.S. Dept. of Veterans Affairs, Circular 26-24-14, Temporary Local Variance for Certain Buyer-Broker Charges
- National Association of REALTORS®, NAR Settlement FAQs (updated Oct. 29, 2024)
- Florida Realtors, NAR Settlement: Forms, Resources, Webinars (forms list incl. riders FF and GG)
- Florida Realtors/The Florida Bar, AS IS Residential Contract for Sale and Purchase (ASIS-7x, Rev. 12/24, 2026 update)
Last reviewed October 2026. Laws change; confirm current law before relying on this page.