Option 1 – Buyer compensates their brokerage firm directly - This will likely be collected at closing and show up on the closing disclosure. This should have little to no impact on their agreement with the seller to purchase the property.
Option 2 – Negotiate a credit from the seller in the purchase and sale agreement- This path involves the buyer negotiating a credit from the seller as part of the purchase and sale agreement. Rider FF to the Florida Realtors®/Florida Bar Residential Contract for Sale and Purchase is titled Credit Related to Buyer’s Broker Compensation. This rider enables a seller to provide a credit (dollar amount, percentage or percentage plus dollar amount) that will enable the buyer to cover some or all of the amount described in their buyer broker agreement.
Option 3 – Ensure a listing broker enters into a compensation agreement with the buyer’s broker - This third path involves the buyer ensuring the listing broker enters into a separate agreement with the buyer’s broker to cover some or all of the amount the buyer owes their brokerage firm. Florida Realtors form Compensation Agreement – Seller’s Broker to Buyer’s Broker (CABB-1) can be used to document the broker-to-broker agreement.
One issue the buyer should be aware of is the timing of the CABB. There’s risk if the buyer enters into a purchase and sale agreement before the CABB is fully executed. To alleviate that concern, there is a new rider the buyer can attach to a Florida Realtors/Florida Bar contract titled Rider GG Seller’s Agreement with Respect to Buyer’s Broker Compensation. Rider GG creates a window of time (3 days after the effective date, if left blank) for the buyer to ensure the CABB is executed. If the listing broker and buyer’s broker have not executed an agreement by that deadline, then the buyer can cancel the purchase and sale agreement.
Option 4 – Ensure a seller enters into a compensation agreement with the buyer’s broker - The fourth path involves the buyer ensuring the seller enters into a separate agreement with the buyer’s broker to cover some or all of the amount the buyer owes their brokerage firm. Florida Realtors form Compensation Agreement – Seller to Buyer’s Broker (CASB-1) can be used to document the agreement.
