Final answer:
In a typical real estate transaction, the seller pays the broker's commission, which is a fee for the real estate agents' services. This fee is often factored into the home's price, indirectly affecting both the buyer and seller. Escrow can help manage these and other recurring payments like home insurance and property taxes.
Step-by-step explanation:
In a typical real estate transaction, the seller is generally responsible for paying the broker's commission. This commission is a fee for the services that the real estate agents provide, which typically includes listing the house, marketing it, negotiating with buyers, and handling the sales process.
However, while it is the seller who pays this fee out of the proceeds of the sale, the cost indirectly affects both parties. Sellers often factor the cost of the commission into the price of the home, which means the buyer may effectively contribute to this cost through a higher purchase price.
It is important to understand that the specifics can vary, and in some cases, both the buyer and seller may negotiate particular terms where the commission costs are shared differently. Additionally, the concept of Escrow is relevant here. Escrow is a third-party service that can manage the transfer of funds during the transaction and can be responsible for ensuring that recurring costs like home insurance and property taxes are paid as part of the buyer's normal monthly payment, streamlining the process for the homeowner.