BIC TIP #1208: The Listing Agreement Compensation Section Explained

ByStephen Long
Watch Stephen Long walk through the compensation section of the listing agreement, subsection by subsection.

Listing agents, do you like money? Then this one is for you. Stephen Long, The Notorious BIC, has been fielding a lot of questions about how to complete the compensation section of the listing agreement. The paragraph has three key subsections, B, C, and D, and knowing what goes where is how you make sure you get paid.

Subsection B: The Listing Firm

Subsection B is what you, the listing firm, are collecting. Your fee goes here, along with any administrative fees or other charges you collect as the listing firm.

Stephen adds an important detail: if you are going to be paid for both sides of the transaction when there is no buyer’s agent, that information belongs in subsection B as well. Spell it out so there is no question later.

Subsection C: The Cooperating Broker

Subsection C covers the co-broke, meaning what is being offered to a seller subagent or a buyer’s agent who brings a buyer. This is where you record what the seller has agreed to offer as an incentive to cooperating brokers.

Remember, Stephen notes that you cannot offer compensation in the MLS, but you can offer it elsewhere. Subsection C is where that offer is documented in your agreement with the seller.

Subsection D: The Total, If You Can

Subsection D is where you add B and C together for a total. That works when the result is a finite number.

But if compensation is fluid, for example “if this happens, then I get paid that,” you may not be able to fill in a single total. That is exactly why subsection D is marked optional. Do not force a number that does not reflect the actual agreement.

The Practical Takeaway

B is the listing firm, C is the cooperating broker, and D is the optional total. Fill each one out deliberately, and make sure every fee you expect to collect is written down. Stephen expects updated listing agreements as July approaches, so watch for new forms. In the meantime, check your paperwork so you can get paid, and ask your broker-in-charge if a scenario does not fit neatly.

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