# Section 8: Compensation & Buyer Representation {% hint style="info" %} 🟦 = NAR-based policy provision {% endhint %} {% hint style="danger" %} **MLS Role on Compensation:** The BSCMLS does not set, recommend, require, or police commission rates or brokerage fees. Compensation is negotiated between clients and brokerages and must be handled off the MLS in compliance with these Rules and applicable law. {% endhint %} ### [8.1 – Prohibition of Compensation Offers in the MLS](#id-8.1-prohibition-of-compensation-offers-in-the-mls) 🟦 NAR Policy 8.11 Participants and Subscribers (and their sellers) are prohibited from making offers of compensation to buyer brokers or other buyer representatives in the MLS, or from using any BSCMLS product, service, platform, or meeting to communicate such offers. This includes inserting compensation offers in remarks, photos, associated documents, or links in any MLS field that directs users to compensation offers. Any cooperation or participation statements intended to invite buyer brokers is prohibited in the MLS because it could reasonably be interpreted as an implied offer of compensation, even if no dollar amount is stated. Using MLS data or data feeds to directly or indirectly establish or maintain any platform of compensation offers from multiple brokers or other buyer representatives may result in termination of access to MLS data and data feeds. {% hint style="danger" %} #### **Policy Note – Compensation References in Sold Details and Remarks:** MLS fields, remarks, and sold details may not be used to communicate, explain, or justify changes in price by referencing buyer-agent compensation, including statements that compensation was waived, reduced, deducted, credited, or otherwise factored into the purchase price. If a Participant or Subscriber wishes to document a neutral transaction fact that does not reference compensation, they may do so in a manner that avoids any mention of buyer-agent compensation. For example, a neutral factual statement such as “Buyer is a licensed real estate agent” may be permissible if otherwise accurate and relevant. However, references connecting the sale price, list price, or list price-to-sold price ratio to the waiver, reduction, or treatment of buyer-agent compensation are prohibited. When additional transaction context is needed, the Listing Agent may direct other MLS users to contact the Listing Agent for further details outside the MLS, provided no compensation-related information is communicated through MLS remarks, sold details, or other MLS fields. {% endhint %} #### [A. Permissible Communication (Outside the MLS)](#a.-permissible-communication-outside-the-mls) The prohibition on offers of compensation applies only to the MLS and BSCMLS-operated products, services, platforms, and meetings. Participants and Subscribers may communicate about compensation **outside** MLS systems in lawful, off-MLS channels (e.g., between brokers, between a broker and a consumer, or through written agreements), provided the communication is not included in or linked through any MLS listing field and is not created, facilitated, or supported using MLS data or data feeds as a multi-broker compensation platform. Permissible communications under this subsection do not authorize public advertising or mass distribution of compensation offers to multiple brokers or buyer representatives; compensation offers must remain off-MLS and be handled through appropriate non-MLS channels. {% stepper %} {% step %} #### **Direct Communication:** Telephone calls, text messages, and direct emails. {% endstep %} {% step %} #### **Proprietary Marketing:** The Listing Agent’s own website (for their own listings only), physical yard signs, and printed marketing materials (e.g., flyers available at the property). {% endstep %} {% step %} #### **Direct-to-Consumer:** Open house discussions or social media posts on the Agent’s personal or business page. {% hint style="info" %} **Reminder:** any compensation-related content must remain off-MLS and must not be linked to or accessible via MLS fields or MLS-fed pages. {% endhint %} {% endstep %} {% endstepper %} ### [8.2 – Seller Concessions in the MLS](#id-8.2-seller-concessions-in-the-mls) Sellers are permitted to advertise concessions to buyers in the MLS. Common concessions include closing costs, prepaid expenses, interest rate buy-down, etc. Concessions can be advertised upfront or negotiated as part of a home purchase agreement. In the agreement, a concession is often written as a specific dollar amount. Seller concessions usually aren’t binding until they are put into a contract like a purchase agreement. {% stepper %} {% step %} **Restrictions:** Seller concessions must be written as the total sum of all concessions offered and cannot be conditioned on the use of, or payment to, a Buyer’s Agent. The limit on the total value of concessions that can be offered depends on the terms set by the buyer’s lender and state law. Loan program and lender limits on concessions vary. Any agreement for a seller or listing Participant to pay compensation to a buyer broker or other buyer representative must be handled off-MLS and documented through appropriate non-MLS channels (e.g., negotiation and contract terms). {% endstep %} {% step %} **Display:** The seller’s willingness to offer concessions may be mentioned in Public Remarks or Agent Remarks (e.g., “Seller is willing to negotiate buyer concessions.”). If mentioned in Remarks, the agent may note the seller's willingness to negotiate concessions without specifying the dollar amount, directing buyers to contact the listing agent for details. {% endstep %} {% endstepper %} ### [8.3 – Required Consumer Disclosure on Compensation](#id-8.3-required-consumer-disclosure-on-compensation) 🟦NAR Policy 8.12 Participants and Subscribers must provide consumers with clear, written disclosure that broker compensation is **not set by law and is fully negotiable**. This disclosure must be included in conspicuous language as part of: **(1)** any listing agreement, **(2)** any written buyer agreement, and **(3)** any pre-closing disclosure documents (if any). In addition, in advance of **any payment or agreement to pay** compensation, Participants and Subscribers must disclose in writing to the consumer the **amount or rate of compensation** the Participant will receive (or how it will be determined) and **from what source** the compensation will be paid (e.g., buyer, seller, listing broker, or other source). ### [8.4 – Required Written Buyer Agreements (Prior to Touring a Home)](#id-8.4-required-written-buyer-agreements-prior-to-touring-a-home) 🟦NAR Policy 8.13 Unless inconsistent with state or federal law or regulation, all MLS Participants “working with” a buyer must enter into a written agreement with the buyer prior to “touring a home”. For this rule, a “home” means a residential property consisting of 1–4 dwelling units. {% stepper %} {% step %} **“Working With”** is intended to distinguish MLS Participants who provide Brokerage services to a buyer, from MLS Participants who simply market their services or just talk to a buyer - like at an open house or by providing an unrepresented buyer access to a home they have listed. If the MLS Participant is working only as an agent or subagent of the seller, then the Participant is not “working with the buyer.” In that scenario, an agreement is not required because the Participant is performing work for the Seller and not the Buyer. If the Participant is providing brokerage services for the buyer (including transaction brokerage or authorized dual agency), the Participant is “working with” the buyer for purposes of this rule. {% endstep %} {% step %} **“Touring a Home”** means when the buyer and/or the Participant, or another agent, at the direction of the Participant working with the buyer, enters the house. This includes when the Participant or another agent, at the direction of the Participant, working with the buyer enters the home to provide a live, virtual tour to a buyer that is not physically present. This “touring a home” trigger applies only to “homes” (1–4 residential dwelling units). {% endstep %} {% step %} **Required Agreement Content:** The agreement must include: **A)** a specific and conspicuous disclosure of the amount or rate of compensation the Participant will receive or how this amount will be determined, to the extent the Participant will receive compensation from any source; **B)** the amount of compensation in a manner that is objectively ascertainable and not open-ended; **C)** a term that prohibits the Participant from receiving compensation for brokerage services from any source that exceeds the amount or rate agreed to in the agreement with the buyer; and **D)** a conspicuous statement that broker fees and commissions are not set by law and are fully negotiable. {% endstep %} {% endstepper %} {% hint style="danger" icon="square-pen" %} **Note:** This requirement does not mandate a particular type of agency relationship; it requires a written agreement that meets the content requirements above. {% endhint %} --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. 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