Are Realtor Commission Rebates Legal in VA, MD or DC?
November 27th, 2007 by David | 1,089 views |
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Many home buyers are not only unfamiliar with the concept of real estate commission rebates in the DC Metro area, but remain unsure whether these home buyer rebates (sometimes called “credits” or “refunds” or “cash back”) are even legal in Northern Virginia, Maryland and Washington DC at all. I’ve run across the same questions time and time again from first time home buyers on this topic…Where does the money come from? How does a Realtor commission rebate work? Will a real estate agent refund effect the price I pay for the home?
Now for the answers -
- YES! Real estate agent rebates are legal in Northern Virginia, Maryland and Washington DC.
- The money comes from the seller’s agent or builder, who offers the buyer’s agent a predetermined commission amount (typically 3%), agreed upon with the seller at the time the property is listed. The buyer’s agent rebates a portion of their commission to their client (home buyer).
- Home buyer rebates DO NOT effect the price of the home- since the amount of the commission offered to the buyer’s agent is predetermined prior to listing the home, it doesn’t effect the home price if you buy with or without an agent, the seller’s agent or builder simply pockets the entire commission (many times 6%). On top of that, the home buyer will not have a DC Metro area real estate agent’s representation looking out for their best interests!
Still don’t believe me?? Well, check it out for yourself, Home buyer rebates ARE legal in VA, MD & DC according to the DOJ. The U.S. Department of Justice (DOJ) recently launched a new website on competition in the real estate industry. The Antitrust Division of the DOJ promotes and protects the competitive process through the enforcement of antitrust laws. Simply put–they prohibit price-fixing. The site was created to educate consumers about the benefits that commission competition brings to the consumer of real estate services. The chart below from the DOJ website shows the median commission paid by consumers per home between 1998-2007.

Simply put, buyer agent rebates make buying a home more affordable… period. Most people generally think of a rebate as a cheap, minuscule amount or barely even worth the effort of mailing out. However, when talking about Realtor rebates in real estate, we’re talking thousands of dollars back to you, the home buyer. Especially since the average home in the Northern Virginia/DC Metro area is ballparking (apparently not a real word) around $500,000, a new home rebate at this price with HomeZill would equate to $10,000! Definitely NOT chump change…
I ran across an interesting piece on Cash Back Rebates to Home Buyers, posted by a real estate agent in Illinois. BTW- Illinois is among the nation’s 37 Realtor rebate friendly states.
Thinking about buying a home in the DC Metro area soon? Call 1-888-998-9455 to receive up to a 2% cash back Realtor rebate when buying any new home construction or resale home in Northern Virginia, Maryland or Washington DC. Whether you’re a first time home buyer or seasoned real estate investor, you deserve a rebate for doing your share of the leg-work! To learn more about our 2% HomeZill.com Realtor rebate program, click here.
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This entry was posted on Tuesday, November 27th, 2007 at 6:10 pm and is filed under Buying a Home, Cash Back to Home Buyers, First Time Home Buyer, Home Buyer Rebates, HomeZill.com, Incentives, MD Real Estate, New Home 2% Rebate, Northern Virginia Real Estate, Virginia Real Estate, Washington DC Real Estate. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
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December 5th, 2007 at 10:31 pm
Before reading this post I was very confused on how this rebate thing works. This was very helpful.
Thanks!
January 27th, 2008 at 6:56 pm
[…] protected and ensure that your offer is a good one–all at no cost to you. We will also rebate you two-thirds of the buyer agent commission for new homes and half the commission for resale homes. […]
May 14th, 2008 at 5:59 pm
I would not suggest merely selecting an agent based on the best rebate, but rather a combination of the service to be provided as well as a buyer’s rebate. A good buyer’s agent will go to bat for the home buyer that potentially saves the home buyer thousands extra through strong negotiations in all aspects of the transaction; one can be “penny wise, pound foolish” when selecting an agent solely on the amount of the rebate. What’s most invaluable is when a buyer’s agent will contend on your behalf for the numerous issues that usually arise during a real estate transaction.
May 19th, 2008 at 5:53 pm
In the Atlanta market, rebates are most effective when used by a highly skilled buyer’s agent.
June 26th, 2008 at 12:14 pm
Commission rebates are very important to home buyers, insomuch as they reduce the cost of a real estate transaction; what’s more, it encourages representation that a buyer can really benefit from.
June 30th, 2008 at 8:59 pm
Yes, real estate broker rebates to home buyers are legal in Virginia, Maryland and Washington, DC. I am a real estate broker and I offer full service and commission rebates to home buyers in the DC metro area.
David Gorman
Cashback Realty.com
tel 703.333.2055