What does the term "commission split" refer to?

The term "commission split" primarily refers to the division of the real estate commission between the listing agent and the buyer's agent. In real estate transactions, a commission is generally paid by the seller to the agents involved, and this commission is often divided between the agent representing the seller and the agent representing the buyer based on a predetermined agreement. This split can vary depending on the arrangement between the agents and their respective brokerages.

Understanding how a commission split works is essential for real estate professionals and helps clarify how earnings are distributed in transactions. It reflects the collaborative nature of real estate dealings, where both agents contribute to facilitating the sale but receive compensation based on their specific roles in the process.