Buyer-Agent Rebates: Compare Your Options
Learn how buyer-agent rebates work, compare percentage discounts with a flat-fee model, and check where rebates are generally permitted before estimating your own amount.
Buyer-agent fees are negotiable and should be stated in a written agreement before touring. A rebate reduces what the brokerage keeps. It does not create extra commission.
Written by Lucas Beard
COO, TurboHome · California DRE 02417843 · Updated July 10, 2026 · 8 min read
Reviewed by Kevin Kretzmer
Head Agent, California · CalDRE #01997822
Two Ways Brokerages Reduce Buyer Fees
A percentage discount is simple and predictable. A flat fee can return more at higher purchase prices because the broker's retained fee does not rise at the same rate as the home price.
| Model | How it works | Example | What to check |
|---|---|---|---|
| Percentage discount | The brokerage reduces its fee or refunds a fixed percentage of the purchase price. | Redfin says its buyer fees vary by market and offers eligible buyers a 0.25% Sign & Save discount. | Availability, eligibility, agreement term, and the total market fee. |
| Tiered flat fee with rebate | The brokerage keeps a price-tiered flat fee and credits remaining compensation to the transaction. | TurboHomeThe calculator below shows the exact fee for each selected home price. | Compensation received, the applicable fee, lender approval, closing instructions, and state law. |
| Traditional percentage agent | The agent keeps the full standard buyer-agent fee assumed for this page. | 2.5% of the home price$25,000 at the page's $1,000,000 planning price, with $0 returned to the buyer. | The written fee, services included, seller-paid compensation, and any buyer shortfall. |
TurboHomeWhat Changed After the NAR Settlement
NAR's written-buyer-agreement guidance says MLS participants working with a buyer need an agreement before touring, with an objectively ascertainable compensation amount or method. The 2024 changes did not eliminate buyer agents, seller-paid compensation, or rebates.
Agree before touring
MLS participants working with a buyer generally need a written agreement before an in-person or live virtual home tour.
Set an objective fee
The agreement must state the compensation amount or rate, or explain how it will be determined. The amount cannot be open-ended, and commissions are fully negotiable.
Negotiate outside the MLS
Offers of buyer-broker compensation are no longer displayed through the MLS. Buyers can still request seller-paid compensation or structure their own broker fee as part of the offer.
Compare the Rebate at Your Home Price
Move the slider and adjust the planning assumption for your market. The Redfin figure shows only the published 0.25% eligible discount, not Redfin's full market fee. TurboHome's estimate equals compensation actually received minus the exact applicable flat fee. The traditional-agent baseline assumes the agent keeps the full 2.5% fee, leaving $0 to return.
Unlock your $16,000 rebate at closing
Plan with 2.5% buyer-agent compensation. We credit you back and take a low flat fee.
*Estimate based on 2.5% buyer-agent compensation. Actual compensation is negotiated in your written buyer agreement.
Your planning estimate
$16,000
Estimated rebate after TurboHome applies its exact price-tiered flat fee to the $1,000,000 home price and 2.5% compensation assumption.
- Estimated compensation
- $25,000
- TurboHome flat fee
- $9,000
- Estimated rebate
- $16,000
Final rebate depends on compensation received, your written agreement, lender approval, and closing instructions.
What you'd get back at $1,000,000
$16,000
TurboHome
your rebate
$2,500
Redfin
eligible 0.25% discount
$0
Traditional agent
keeps the standard 2.5% fee
Redfin reflects its publicly advertised eligible discount. The traditional-agent baseline assumes the full stated fee is retained, so $0 is returned to the buyer. Actual terms remain negotiable.
How Lenders May Treat a Buyer Rebate
A rebate must be disclosed and approved before closing. For conventional loans sold to Fannie Mae, a real estate agent or broker is an interested party, financing concessions cannot exceed eligible closing costs, and the maximum depends on occupancy and loan-to-value ratio.
| Occupancy | LTV or CLTV | Maximum financing concession |
|---|---|---|
| Principal residence or second home | Greater than 90% | 3% |
| Principal residence or second home | 75.01% to 90% | 6% |
| Principal residence or second home | 75% or less | 9% |
| Investment property | All CLTV ratios | 2% |
Fannie Mae's guide also says rebates not credited toward the transaction are sales concessions, undisclosed contributions make a mortgage ineligible, and these funds cannot satisfy a down payment, reserve requirement, or minimum borrower contribution.
FHA
HUD says reasonable seller-paid buyer-broker fees following state or local law or custom are not interested-party contributions when other requirements are met. That guidance does not classify every brokerage rebate, so the lender still needs to approve the actual structure.
VA
VA Circular 26-24-14 allows certain veteran-paid buyer-broker charges under a temporary variance, requires documentation, and says seller-paid buyer-broker charges are not seller concessions. It does not create a universal rule for every buyer rebate.
Is a Home Buyer Rebate Taxable?
An IRS private letter ruling concluded that a buyer-agent commission payment or closing credit generally represented an adjustment to the home's purchase price rather than gross income. The ruling applies only to the requesting taxpayer and cannot be cited as precedent. A purchase-price adjustment may affect tax basis, so keep the closing statement and ask a qualified tax professional about your transaction. This is general information, not tax advice.
Real closing proof
What a buyer rebate looks like at closing
This real commission statement records $36,875 in buyer-agent compensation and a $26,875 agent credit to the buyer for closing, leaving $10,000 retained from the commission.
Real buyer transaction, shared with permission. Personal and property details are outside the crop. Results vary by transaction, compensation received, lender approval, and the applicable TurboHome fee.
Full-service representation with measurable results
TurboHome closing and customer-review figures used across the site.
225+
homes closed
~$25K
average rebate
~2×
offer win rate
4.8★
customer rating
10 recent buyer deals behind the rebate math
Five California and five Texas buyer-represented closings from TurboHome's public archive. Every card is labeled by state and links to its live source record.
Across 10 displayed records: $219,183 total rebates · $21,918 average per record
Scroll to see more deals
How a Rebate Can Help
Reduce closing costs
A disclosed credit may cover eligible closing costs and prepaid items, lowering cash due at closing.
Buy down the rate
A lender-approved credit may fund discount points or an approved temporary or permanent mortgage-rate buydown.
Strengthen the seller's net
Requesting less seller-paid buyer-broker compensation can improve the seller's net when the rest of the offer stays the same.
Fannie Mae's selling guide says interested-party contributions cannot satisfy a down payment, reserve requirement, or minimum borrower contribution. It also treats agent or broker rebates not credited toward the transaction as sales concessions and makes mortgages with undisclosed contributions ineligible. Confirm the structure before relying on the funds.
Where Buyer-Agent Rebates Are Generally Permitted
A May 2025 Federal Reserve review identified buyer-rebate bans in eight states. Rules can turn on who receives the payment, when it is paid, and how it is disclosed. Confirm current law for the property's state.
Federal Reserve review identified bans
Alabama, Alaska, Kansas, Mississippi, Missouri, Oklahoma, Oregon, Tennessee.
Generally permitted, with conditions
Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Pennsylvania, Rhode Island, South Carolina, South Dakota, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming, Washington, D.C..
Older online lists are stale. Iowa's 2024 rule, for example, expressly permits a properly disclosed payment of earned commission to a buyer who is a party to the brokerage agreement. Legal information reviewed July 2026. This page is educational information, not legal advice.
Explore Buyer Rebates by State
Review TurboHome's first-party closed-deal archive
Buyer-Rebate FAQ
What is a buyer-agent rebate in your market?
A buyer-agent rebate returns part of the compensation earned by the buyer's brokerage or credits it to the transaction. The amount depends on the fee model, compensation received, written agreement, lender approval, and closing instructions.
Which states allow buyer-agent rebates?
Buyer-agent rebates are generally permitted in most states, but several states restrict them. Rules change, so confirm current law for the property's state and coordinate the structure with the lender and closing team.
What changed after the 2024 NAR practice changes?
Buyer-broker compensation became more visible and directly negotiable through written agreements. Offers of compensation no longer appear in the MLS, but seller-paid compensation and buyer rebates can still be structured outside it.
What is the difference between a percentage discount and a flat fee?
A percentage discount reduces the buyer broker's fee by a stated share of the purchase price. A flat-fee brokerage keeps a tiered amount and may credit remaining compensation to the buyer's transaction.
Can I use a rebate for closing costs or a lower mortgage rate?
Potentially. A disclosed, lender-approved credit may cover eligible closing costs or fund approved discount points or a rate buydown. It generally cannot replace required down payment or reserves.
How should I compare buyer-agent rebate programs?
Compare the total broker fee, eligibility rules, services included, agreement term, compensation assumptions, lender limits, and whether the advertised amount is a discount, refund, or transaction credit.
How the calculator and guide are built
This is a TurboHome-published guide, and TurboHome is one of the compared services. We prioritize primary sources and show the assumptions behind each estimate.
- Home price
- The slider uses the selected price, rounded to the nearest dollar for displayed results.
- Compensation
- The default is 2.5% for this page. Actual buyer-broker compensation is negotiated in writing and may differ.
- Flat fee
- The calculator uses TurboHome's shared price-tier schedule. Exact upper boundaries stay in the lower tier, so $1M is $9K, $2M is $12K, $3M is $15K, and $5M is $20K.
- Estimated rebate
- Compensation minus the applicable TurboHome fee, floored at zero. Lender, closing, state-law, and transaction limits still apply.
- Comparison baselines
- Redfin shows only its publicly advertised eligible discount. The traditional-agent baseline assumes the agent keeps the full 2.5% fee, so $0 is returned to the buyer.
Pricing, legal references, and competitor program terms were last reviewed July 10, 2026.
Sources
- Federal Reserve, May 2025: compensation changes and rebate-ban review.
- Redfin: market-variable buyer fees and the eligible 0.25% Sign & Save discount.
- National Association of Realtors: written buyer-agreement and compensation requirements effective August 17, 2024.
- Fannie Mae: conventional-loan contribution caps, disclosure, and prohibited down-payment uses.
- HUD/FHA: treatment of reasonable seller-paid buyer-broker fees.
- Department of Veterans Affairs: temporary buyer-broker charge variance and disclosure.
- IRS private letter ruling 200721013: nonprecedential purchase-price-adjustment analysis.
- Iowa 2024 rule: an example of a recent state-law change.