Are Realtor Fees Covered in the Closing Costs?

When selling a house, there are many things that you need to take into consideration. One of the most important is understanding the fees and costs involved. This can be confusing for many people, as real estate transaction fees often are not always clear. 

In this blog post, we will discuss realtor fees and whether they are included in closing costs. We will also provide some tips on how to sell your house without a realtor and what to expect with each method. So let’s get started!

fees when selling your house

Fees When Selling Your House

It can surprisingly be expensive when it comes to selling a house in Idaho. Besides the cost involved with getting your home prepared to sell, you’ll also want to remember there are fees when selling your property. The buyer will need to cover some of these, but several of the fees the seller pays. 

So before you decide to sell your home, you’ll want to learn more about the types of fees and costs involved. That way, there are no surprises at the closing table. 

Types of Fees and Costs 

When selling a house, there are many different types of fees that you need to be aware of. The most common are the realtor fees, seller closing costs, and inspection fees. Below we’ll cover several fees you’ll want to know about. 

Realtor Fees

The realtor fees are the fees that you pay to your realtor for their services. This is a percentage of the house’s sale price and is typically about 5-6%. However, it can vary depending on your location and the company that you use. 

The realtor commission is usually split up between the buyer’s and seller’s agents. 

So what would that look like if you were selling a house with an average home value of $518,939? A realtor’s commission rate will cost anywhere from $25,946- $31,136 (5-6%).

Something to note-  your agent will not receive the full commission you pay. Several parties will split the commission from the sale of your Boise property. The seller’s agent will determine how the commission is split up between them and the buyer’s agent. The seller’s agent will often split the commission 60/40. 

Sixty percent will go to the seller’s agent. The remaining 40% goes to the agent who brings you a buyer.

Commissions will usually be higher for harder-to-sell real estates like mobile homes or land. In addition, some discount brokerages charge a flat fee rather than a percentage commission.

The fee for the buyer’s agent’s commission is usually found on the multiple listing service (MLS). Always inquire about the division of your commission with your agent. If your commission is too low, a buyer’s agent may entirely ignore your listing.

Broker Commissions

Although you would think commissions go to the agents, as we mentioned above, in reality, they go to the agent’s brokers instead. The agents’ brokers then take a portion of the fee either in a flat dollar amount or a percentage. This amount varies from real estate broker to broker and realtor to realtor. The agent’s broker will deduct insurance and office fees from the agent’s commission. Afterward, the agent will receive the remaining amount from their total commission. 

Who typically pays agent commissions for both the buyer and the seller are generally paid for by the seller.

Another alternative, you can always try to sell your house by owner instead to save on realtor commissions. However, if you sell your house on your own or through a real estate agent, you will still have several other costs to selling a home. 

Escrow Fees

When you sell your home, you will want to use a reputable escrow company. The escrow company is a kind of insurance that protects the money between both parties. These companies hold all funds in an escrow account. Escrow companies make sure everyone gets paid. Mortgages, loans, agents, inspectors, liens, and the seller all get paid by the escrow company.

If your buyer is getting a loan to buy your home, their lender will give the money to the escrow company. Then, after paying everyone else, you will receive any remaining funds.

Naturally, escrow firms charge for this. Their costs tend to be around .025% to.05% of the purchase price, and the percentage decreases as the sales price goes up. So for our example of a $500,000 property, an escrow company will charge approximately $2,500 in fees.

Title Insurance 

Title insurance is an important part of every real estate transaction and protects against defects in ownership title. It guarantees that the buyer is getting the property without anyone else having a claim to the home. Buyers don’t want to buy a property only to find a long-lost brother who has an ownership claim on the property. Depending upon the region you’re in, this may be provided by a title company or an attorney.

In some cases, the title company and escrow company may be the same. Your agent will typically have a title company or attorney that they work with regularly. Once you have a signed contract, your agent will forward the contract to the title to open your escrow account.

Closing Costs

Closing costs are the expenses that are incurred when the sale of a house is finalized. This includes things like title search fees, attorney’s fees, and recording fees. The average closing cost is about 2-3% of the house’s sale price.

Closing costs are negotiable, but most of the time, the buyer and seller will split the closing fees down the middle. This means that each party is responsible for paying half of all fees associated with the sale. However, this can vary depending on several factors, including whether or not you have a loan and who pays the agent’s commission. 

Inspection Fees

Inspection fees are charges that are assessed by the home inspector. These fees cover the cost of the home inspection for any potential damage or problems. The average inspection fee is about $300-$500, but it can vary depending on the size and age of the house.


Don’t forget you’ll need to pay property taxes up until the home officially sells. This is typically the responsibility of the seller. 

For example, if you sell your home in June but don’t close until October, you will be responsible for property taxes from June to October.

In other cases, when a buyer closes on a house before their first mortgage payment is due, their lender may request that they include six months of additional tax payments with their closing costs. 

Thankfully, unlike other states like New York and Texas, Idaho doesn’t charge transfer taxes.

Other Fees to Consider

Here are a few other fees to consider when both buying and selling real estate

  • Homeowner’s association (HOA Fees)
  • Homeowner’s insurance 
  • Both buyer’s closing costs and the sellers closing costs
  • Appraisal fees 
  • Loan origination fees
  • Warranty 
  • Title Insurance Policy
  • Mortgage Insurance 
  • Application fee

Are Realtor Fees Covered in the Closing Costs?

One common question that people have is whether the realtor fees are covered in the closing costs. Unfortunately, the answer is no. The realtor fees are a separate cost that you will need to pay. 

However, there are a few ways to include the costs in the transaction. One way is to ask the buyer to pay realtor fees. But what usually ends up happening is the seller is asked to pay all realtor fees. Since the buyer will need to have a downpayment ready and other home-buying expenses, the buyer usually asks the seller to cover realtor fees. 

Another option is to build in the realtor fees in the home purchase price. Typically, when the sellers set a listing price for the home, they usually take the real estate agent’s commission into account; it’s the cost of doing business. 

Besides that, you can always consider alternatives to selling your home that don’t include an agent. 

Alternative House Selling Options to Using Realtors

Many homeowners in Boise looking to sell consider other alternatives to save money on realtor fees. Besides that, listing with an agent provides no guarantee of a fast home sale. 

Below we share a few options, including selling your house online, cash home buyers, house flippers, or by yourself. We’ll take a look at each selling alternative available and its pros and cons. 

Selling your House Online 

When you sell your house online, you give your property info to a website that specializes in buying real estate. These websites typically purchase homes nationally but in specific target markets. They also tend only to purchase properties that are in good condition. Once they have your property info, they use a computer algorithm to create a custom offer for your house.

One of the benefits of selling your house online is that you can usually complete the transaction without having to leave your home. You also don’t have to worry about paying any commissions to a real estate agent. 

However, there are a few drawbacks to selling your house online. The biggest one is that you’ll pay a service charge. There also may be repair costs included and closing costs to cover. Total, this could cost anywhere from 5.5%-10% to sell your house online. 2

Selling By Yourself

Another alternative house selling option is to try selling by yourself. Some homeowners like this since they can be in charge of all aspects of the home selling process. By ‘all aspects’ that would include:

  • Determining a competitive home sale price
  • Making repairs, cleaning, and staging the property to sell
  • Figuring out a marketing strategy 
  • Answering phone calls and emails about your home
  • Hosting showings and open houses 
  • Negotiating offers
  • Handling legal paperwork
  • Finding an escrow company and real estate attorney 

If you have the extra time to handle your home sale, it can provide some savings. Keyword “some.” Since you won’t be hiring a listing agent, you’ll be able to save on part of the commission fee. However, if the buyer uses a realtor, you’ll likely have to pay for the buyer’s agent’s commission. That usually comes to about 2.5-3% even though you would be doing most of the work to sell your home. 

Research has also shown that FSBO homes generally sell for about 6% less than those listed with an agent. And as mentioned above, you’ll still be on the hook for the buyer’s agent’s commission. Furthermore, homes that are for sale by owner often take longer to sell and are more likely to fall out of contract after accepting an offer.

couple selling house to a cash home buyer

Selling to Cash Home Buyers 

Instead of using a realtor, you can always look into selling your house to one of the cash home buyers in Idaho. Similar to selling your house online, you would contact a “Buy my house Boise” company and fill out some info on their website. They would then reach out to you to learn more about your home and schedule a time to see it in person or plan a time for you to do a video walkthrough. 

Some perks to selling to a “We buy houses in Meridian” home buyer include:

  • No realtor commissions
  • No service charges 
  • No repairs required 
  • They buy houses in any condition
  • They can make you a cash offer within 24-hours and close within 7-days
  • They buy houses with unique selling situations, i.e., liens, unpermitted work, pre-foreclosure, distressed or vacant properties, and much more. 

The reason why sellers prefer cash buyers and selling to a local home buyer like Gem State Cash Offer is for its easy home buying process.

Selling to House Flippers

The last option you can look into is selling to house flippers. House flippers buy houses that need work and then make repairs and improvements to resale the property. This is a good option if your home needs quite a bit of work and you’d rather not make the repairs yourself prior to selling. 

Selling to a house flipper would also mean you probably won’t get top dollar for your home. House flippers tend to buy houses below market value so they can make renovations then sell for a profit. Some homeowners don’t mind this selling alternative. Others prefer one of the other selling options we’ve mentioned above.

Final Takeaways

When selling a house, there are various ways to do so. You can sell through a realtor, sell online, sell FSBO, sell to cash home buyers, even sell to house flippers. Each method of sale has its own benefits and drawbacks. However, if you’re looking for ways to sell quickly without making repairs and would like to avoid realtor commissions, then selling to a local cash home buyer may be the best option for you! 

To find out more about selling to a cash home buyer in your area, visit our website or give us a call. We’d be happy to explain our process, our company or share why we’re one of the best home buying companies in Boise!


Kevin is a real estate investor dedicated to helping homeowners sell their properties quickly and without the stress and hassle of a traditional listing.

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