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2. Problems with the Commission
System
I think when we discussed that commission
structure above, it started to become evident why more
and more people are selling houses by themselves and not
hiring agents or brokers to do the job. Think about it –
those commissions can get really big! For a $100,000
house, you’d normally be paying around $6,500 in
commission to your agent.
Why would you pay anybody when you could
probably do a better job by yourself?? There are
more reasons why I am totally disgusted with this
commission system:
If you think about it, most people (this may include
you), finance their homes through the bank. Let’s say you
bought and are making payments on a $100,000 house.
Continuing -
Let’s say you’ve built up $20,000 of equity in the
house (that’s how much you’ve paid so far). Then you turn
around and sell it through an agent and pay a 7%
commission on the sale. You pay that 7% on what the
house sold for - $100,000 x 7% = $7,000!! You’ve only
paid $20,000 on the house, and that huge commission you
just paid to the agent cuts down the equity you’ve built to just $13,000!!
You just gave away over a
third of your
equity to some agent!!
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For Sale By Owner Manual