What Is a Buyer Rebate?
A buyer rebate is when a real estate brokerage returns a portion of their commission to you — the homebuyer — at closing.
When you buy a home, the seller typically pays a commission (often 5-6% of the sale price) that gets split between the listing agent and the buyer's agent. Traditionally, both agents keep their entire share.
With a rebate brokerage like ShopProp, you get most of that buyer agent commission back.
Example
Home price: $1,000,000
Buyer agent commission (2.5%): $25,000
ShopProp flat fee: $7,995
Your rebate: $17,005 back at closing
Are Buyer Rebates Legal?
Yes. Buyer rebates are legal in 40+ states, including California, Washington, Texas, Arizona, Colorado, Hawaii, Michigan, and Virginia.
A few states have restrictions: Alaska, Kansas, Louisiana, Mississippi, Missouri, Oklahoma, Oregon, and Tennessee. If you're in one of these states, check local regulations.
The U.S. Department of Justice has actively supported buyer rebates as a way to increase competition and lower costs for consumers.
How Much Can You Get Back?
Rebate amounts depend on:
- Home price — higher price = larger commission = larger rebate
- Buyer agent commission offered — typically 2-3%
- Brokerage fee structure — flat fee vs. percentage
ShopProp Rebate Examples
| Home Price | Commission (2.5%) | ShopProp Fee | Your Rebate |
|---|---|---|---|
| $500,000 | $12,500 | $5,995 | $6,505 |
| $800,000 | $20,000 | $6,995 | $13,005 |
| $1,000,000 | $25,000 | $7,995 | $17,005 |
| $2,000,000 | $50,000 | $7,995 | $42,005 |
How Do You Receive the Rebate?
Depending on your lender and state, the rebate is delivered as either:
- Credit at closing — reduces your cash to close
- Check after closing — if lender requires
The rebate does not affect your purchase price or loan amount.
What's the Catch?
There isn't one. At ShopProp, you get full-service representation: property tours, offer preparation, negotiations, contract review, inspection coordination, and closing support.
The only difference is we charge a flat fee instead of keeping the entire commission. We've operated this way since 2007 across 4,000+ transactions.
Frequently Asked Questions
Do buyer rebates affect my loan?
No. The rebate is separate from your purchase price and doesn't change your loan terms. Some lenders require the rebate to be paid after closing rather than as a credit, but you still receive the full amount.
Is the rebate taxable?
Generally, no. The IRS treats buyer rebates as a reduction in the purchase price, not as taxable income. Consult a tax professional for your specific situation.
Why don't all brokerages offer rebates?
Most agents want to keep the full commission. Rebate brokerages operate on volume and efficiency, passing the savings to clients instead of maximizing per-transaction profit.
Do I get less service with a rebate?
Not at ShopProp. Every transaction includes managing broker oversight, expert negotiation, and full transaction support. The difference is efficiency, not quality.