How MLS co-operating fees work?

Most Real Estate Companies belong to the Multiple Listing Service. When a listing company takes a listing and belongs to the MLS, they agree to put it in this system to allow all of it’s members of MLS access to this property information. They also agree to co-operate with other real estate agents, and because of this they will offer through the Multiple Listing Service a fee to a Buyer's Agent as well a Sub Agent. Usually it is half of what they listed the property for but does not have to be. 

This is for educational purposes only and all real estate fees are Negotiable

For example:

Let's say the house is listed for $100,000 and the listing agent Sam took the listing for 6%

Sam agreed with the seller that if he brought a ready, willing and able buyer to purchase the property,  he would receive the whole commission of 6% which would be $6000. The Sellers would get a net of $94,000

Sam also agreed with the seller that if another agent which was a member of the MLS system, brought a ready, willing and able buyer, that Sam would co-operate with that other agent and pay him the MLS cooperating fee. In this example he put in 3% to a Buyer's Agent and 3% to a Sub Agent with the sellers permission. Sam would only charge the seller 3% in this case.

If the buyers bought the house for $100,000

Listing Agent Sam would get $3,000

Buyer Agent Jane would get $3,000

The Sellers would get a net $94,000

Because of this MLS cooperating fee it just makes sense to hire you own agent unless you want the listing agent to put the total fee into his pocket and you receive no representation.