If you’re buying a house in a state that allows home buyer rebates, you should try to get one. Finding a realtor you like that offers rebates could potentially save you thousands of dollars — without any real trade-offs.
Most buyers can choose from multiple local brokerages that have commission rebate programs. There are even free companies that match you with top-rated local agents — and negotiate rebates for you!
If you’re just looking for the largest rebate available, some discount brands advertise huge savings. But availability is limited and there are significant trade-offs, including complicated eligibility criteria and reduced hands-on service from your agent.
We’ve researched more than a dozen nationwide and regional companies that offer real estate rebates — and combed through thousands of customer reviews — to find which brands offer the biggest savings and best overall value.
Keep reading to learn about the top realtor rebates available near you, how these programs work, tax implications, and what factors to consider when comparing your options.
🏆 Top picks: Home buyer rebate programs
|Company||Why it's great||Availability|
|Clever Real Estate||Big savings at most price points. Work with agents from top brands like RE/MAX and Century 21.||Nationwide*|
|Prevu||Largest savings on homes above $1 million, but some service trade-offs.||CA, CT, MA, NY, PA|
|Trelora||Largest savings on homes under $350,000, but major service trade-offs.||AZ, CA, CO, GA, NC, SC, WA|
Clever Real Estate offers the best home buyer refund program for most people. Clever matches you with top local agents from trusted brands like Keller Williams and Berkshire Hathaway. Once you find the perfect house, you can earn a cash-back reward worth up to 0.5% of the home price on a qualifying purchase.
Some regional discount brands offer larger rebates to experienced buyers who are comfortable purchasing a house without the full support of a traditional real estate agent. Buying with these brands typically means less hands-on service from your agent, so they’re not the best fit for the average buyer.
Who should look for a realtor rebate?
Most home buyers in eligible states should try to find a realtor who offers rebates. After all, it’s free cash. Real estate rebate programs are becoming increasingly common, so there’s a good chance you can find a great local agent that offers buyer refunds.
That said, some home buyer rebate programs offer more value than others. Here are some factors to consider when comparing the options available in your area.
Full list: The best home buyer rebate programs
Top home buyer rebates available nationwide
Clever Real Estate
- 0.5% Cash Back
- Best Agents
- Available Nationwide
Clever’s cash-back refund program is a great option for most home buyers. It offers better savings than its nationwide competitors — and more hands-on service than any of the regional brands we’ve researched.
Clever has a 4.9 out of 5 rating (1,810 total reviews) on popular review sites like Google, Facebook, and Trustpilot.
Clever Real Estate is available nationwide. It offers cash-back refunds wherever rebates are allowed.
Clever Real Estate has the best home buyer savings program available nationwide. It offers more average savings than its nationwide competitors — and much better service than any of the regional brands we’ve researched.
Eligible buyers can earn a cash-back refund worth up to 0.5% of the purchase price when they find their agent through Clever. On a qualifying $500,000 home, you’d net $2,500 in savings. And since it’s a cash-back reward, there are no restrictions on how you can spend it.
Customer service sets Clever apart from regional brands that advertise larger rebates. One of Clever’s licensed Concierge Team members will hand-pick agents for you from local brokerages, including top brands like Century 21 and Coldwell Banker.
Since you’ll be working with a traditional agent, you won’t have to worry about service trade-offs. You’ll get all the service and support you expect from a local realtor, except you get a cash-back bonus after closing on your new home.
- 0.5% Cash Back
- Best Agents
- Available Nationwide
UpNest is worth considering for most buyers. But some UpNest agents don’t offer any savings. We recommend trying both UpNest and Clever and choosing the agent that offers the best overall value.
UpNest has a 4.6 out of 5 rating (4,267 total reviews) on popular review sites like Google, Facebook, and Trustpilot.
UpNest is available nationwide. Agents can offer rebates wherever they are allowed, although some agents don’t offer any money back.
UpNest is another free service that can match you with local real estate agents — and potentially get you a home buyer rebate.
Whether you’ll actually get a rebate depends on what agents UpNest matches you with. Some agents offer rebates to win your business, but they aren’t required to — and you won’t know if you’re eligible for savings until after you sign up. UpNest also offers every buyer a $150 gift card, but this isn’t much of an incentive on its own.
When we mystery shopped UpNest, we found that agents typically quoted rebates ranging from 0.3–0.75% of the sale price (when they offered rebates at all). Agents are more likely to offer larger rebates if you’re buying a higher-priced home.
If you do get a rebate through UpNest, you’ll receive it as a closing cost credit. This type of rebate has more eligibility restrictions than cash-back refunds. And since closing cost credits impact your loan underwriting process, your agent can’t guarantee the full rebate amount up front.
UpNest and Clever are both free and easy to use, so it’s a good idea to request agent matches from both services. Compare savings, experience, and overall value to find the agent (and buyer refund) who’s the best fit for you.
» MORE: Read the full UpNest review.
- Avg. 0.2% Rebate
- Less Hands-On Service
- Available in 80+ U.S. Markets
For most buyers, Redfin is only a good option if you live in one of the few locations where its typical rebate size is larger than what you’d get from a local Clever or UpNest agent.
Redfin has a 3.8 out of 5 rating (425 total reviews) on popular review sites like Google, Yelp, and Consumer Affairs.
Redfin is available in 80+ U.S. markets, giving it near-nationwide coverage.
Redfin is one of the most well-known discount real estate brands, but its realtor rebate program doesn’t offer much value for most buyers.
Based on our research, the average Redfin rebate is just 0.22% of the home price — less than half of what Clever offers. But Redfin doesn’t advertise a set rebate amount — size and availability both vary between markets. To see how much you can actually save — or if Redfin’s buyer refund is available in your area at all — go to Redfin.com and look for listings in your area and price range.
Another downside to buying with Redfin is that you don’t get to work with a traditional agent — you’ll work with a Redfin agent instead. Redfin has plenty of good agents, but they provide less hands-on support than traditional realtors — and tend to work with a lot more customers at once.
Redfin’s customer service model is fine for many experienced buyers if you live in one of the few locations where Redfin’s largest rebates are available. But if you’re a first-time buyer — or it’s been a few years since your last purchase — you might feel more comfortable navigating such a huge financial decision with the help of Clever or UpNest.
Regional brands that offer bigger savings (but less hands-on service)
In addition to the nationwide home buyer rebate programs listed above, there are a variety of regional brands that might be available in your area.
Most of these discount companies advertise bigger rebates than their nationwide competitors — typically 1–2% of the home price — but they also tend to have larger service trade-offs. They’re only worth considering if you’re a very experienced home buyer and don’t need an agent to guide you through every step of the process.
- Max 2% Rebate
- Less Hands-On Service
- Limited Availability
Prevu is a great option for experienced home buyers with a budget of $1 million or more. But at lower price points, minimum commission fees will limit how much you’ll actually save.
Prevu has a 5.0 out of 5 rating (343 total reviews) on popular review sites like Google, Facebook, and Zillow.
Prevu is available in the following areas: CA, CT, MA, NY, PA.
Prevu’s Smart Buyer rebate is a good option if you’re buying a higher-priced home in California, Connecticut, Massachusetts, New York, Pennsylvania, or Washington state.
On eligible purchases, Prevu offers a 2% commission rebate, which is the largest buyer refund we’ve seen. But you’ll only qualify for the full rebate on homes worth close to $1 million or more. Buyers with smaller budgets will receive much smaller rebates — if they qualify for one at all.
Prevu agents offer a similar level of service and support to Redfin. You should expect less hands-on service than you’d get with a traditional realtor, but if you’ve bought and sold a lot of homes, the potential savings may be worth the trade-offs.
» MORE: Read the full Prevu review.
- Max $6,000 Rebate
- Major Trade-Offs
- Limited Availability
Trelora offers the largest savings for experienced buyers with budgets less than $350,000. But big service trade-offs and a $6,000 rebate cap make it a worse option for everyone else.
Trelora has a 4.7 out of 5 rating (1,155 reviews) on popular review sites like Google, Yelp, and Zillow.
Trelora is available in the following areas: AZ, CA, CO, GA, MO, NC, SC, WA.
Trelora is worth considering if you’re an experienced home buyer with a budget under $350,000. You could earn up to half your agent’s commission — typically 1–1.5% of the purchase price — even on homes in lower price ranges. But it’s not a great option for buyers with larger budgets because it caps rebates at $6,000 maximum.
Trelora also has some pretty major service risks, even compared with its peers. Our biggest concern is that Trelora agents handle 20x as many customers as the average realtor. It’s just not possible to give customers as much hands-on, personalized service when you’re handling that kind of volume.
» MORE: Read the full Trelora review.
- Max 1.5% Rebate
- Less Hands-On Service
- Limited Availability
SimpleShowing is worth considering if its rebate if its rebate is far and away the largest rebate available near you. But the average buyer probably won’t end up earning the full rebate.
SimpleShowing has a 4.9 out of 5 rating (245 total reviews) on popular review sites like Google, Yelp, and Zillow.
SimpleShowing is available in the following areas: FL, GA, TX.
SimpleShowing advertises a fairly large rebate and has fewer service drawbacks than Trelora. But complicated restrictions prevent the average buyer from qualifying for the full rebate.
When you buy a qualifying house with a SimpleShowing agent, you’ll get a closing cost credit worth up to half of the buyer’s agent commission. To earn the maximum SimpleShowing rebate, buyers must tour five or fewer homes before making a purchase. Once you’ve looked at six homes, the rebate amount starts to shrink, and it gets smaller the more showings you schedule.
The average buyer tours nine homes before making a purchase, so you’ll need to be more decisive to earn the full SimpleShowing refund. Unfortunately, how many homes you look at before you buy isn’t always under your control — especially if you’re buying in a hot market where bidding wars are the norm.
- Max 1.5% Rebate
- Major Trade-Offs
- Limited Availability
Homie could be a good fit if you’re an experienced home buyer in a market where cash offers are common. But service trade-offs make it a poor option for the average person.
Homie has a 4.3 out of 5 rating (1,132 total reviews) on popular review sites like Google, Facebook, and Yelp.
Homie is available in the following areas: AZ, CO, ID, NV, UT.
If you’re buying in a market where cash offers are common, Homie might be a good fit. Homie lets you borrow the funds to place all-cash offers on homes, and you can also earn a commission rebate worth up to half the buyer’s agent fee.
But like Trelora, Homie has some major service trade-offs. Homie agents handle about 10x as many transactions as typical realtors. With your agent juggling so many other customers at once, you should expect less personalized customer service than you’d expect from a traditional agent.
Another downside is that Homie requires buyers who want a rebate to use the company’s in-house mortgage and title services. Letting Homie handle your loan underwriting and closing is convenient. But if other local companies offer better rates, you’re essentially overpaying on your mortgage and closing fees to get a commission rebate.
» MORE: Read the full Homie review.
Tips for choosing a realtor rebate program
First-time buyers should choose the best agent (not the biggest rebate)
If you’re a first-time home buyer, your top priority should be finding the best agent, not the largest realtor rebate. Companies like Clever and UpNest are a great fit for buyers of all experience levels because they help you get a refund without sacrificing the support of a traditional realtor.
Having an experienced real estate agent on your side to help you find the right house and negotiate a great deal is more important than saving a few extra bucks. Choosing the wrong house because your agent didn’t give you enough hands-on service could cost you a lot more in the long run than you’d gain from the rebate.
Experienced buyers can get larger rebates if they do more work themselves
If you have lots of real estate experience and don’t need an agent to guide you through every step of the process, it’s worth considering whatever discount brand that offers the largest rebate available in your area and price range.
Homie, Prevu, SimpleShowing, and Trelora all offer sizable commission rebates, depending on your budget. If you’re buying in a larger market, there’s likely at least one of them available in your area.
Find a realtor rebate program that fits your budget
It’s important to find a realtor rebate program that fits your budget. Most companies have minimum commission fees, which means your agent must earn a set dollar amount before they’ll give you anything back. You won’t earn a full rebate if you buy a lower-priced home and your agent’s commission is below the cut off.
Select the home price range that’s closest to your budget to find recommendations that help you earn as large a rebate as possible.
Find a home buyer rebate program near me
To find a home buyer rebate program near you, select your state in the table below. Click on each company’s name to read in-depth reviews.
|🏠 Company||💰 Max. rebate||✍️ Editor's take|
|Clever Real Estate||0.5%||Big savings at most price points. Work with agents from top brands like RE/MAX and Century 21.||Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Kentucky, 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, Washington D.C., West Virginia, Wisconsin, Wyoming|
|Homie||1.5%||Big savings at lower price points, but major service trade-offs.||Arizona, Colorado, Idaho, Nevada, Utah|
|Prevu||2%||Largest savings on homes above $1 million, but some service trade-offs.||California, Connecticut, Massachusetts, New York, Pennsylvania|
|Redfin||0.22%||Small rebates in most markets.||Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin|
|SimpleShowing||1.5%||Big rebate on paper, but many buyers won't earn full refund.||Florida, Georgia, Texas|
|Trelora||1.5%||Largest savings on homes under $350,000, but major service trade-offs.||Arizona, California, Colorado, Georgia, North Carolina, South Carolina, Washington|
|UpNest||$150*||Only $150 in guaranteed savings, but some agents offer bigger rebates.||Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Kentucky, 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, Washington D.C., West Virginia, Wisconsin, Wyoming|
Note: If your state is isn’t listed in the table above, you may be in an area where home buyer rebates aren’t legal (or are heavily restricted).
When rebates aren’t an option (or aren’t worth it)
If you’re buying in a state where rebates aren’t legal or your budget is less than $150,000, finding a buyer refund shouldn’t be your top priority. You either won’t qualify for a rebate, or you won’t save enough to affect your decision to choose one agent over another.
In either case, your best option to save money is to hire a realtor who’s an expert negotiator. Even if you don’t get a rebate, the right agent can help you negotiate a great deal on a house — and keep more of your hard-earned money in your pocket.
The easiest way to find a great local buyer’s agent is to use a free agent matching service like Clever, UpNest, or HomeLight. These companies connect you with agents in your area so you can compare your options and choose the best fit for you.
Another way to save money when buying a house is to shop around for closing costs, rather than just going with whatever companies your lender or agent recommends. Getting multiple quotes from local service providers will take a bit more time, but finding lower rates could reduce your closing costs by hundreds or thousands of dollars.
How home buyer rebates work
Companies or agents often advertise or offer home buyer rebates as a percentage of the final sale price — for example, a 1% rebate on a $500,000 home would equal $5,000.
Sometimes agents offer rebates as a percentage of the fee they earn on the sale, which is a little more complicated. As an example, if an agent earns a 3% commission and offers you a 50% rebate, you’d get back half their commission, or 1.5% of the sale price.
You receive the rebate at closing, usually in the form of a closing credit. This means you can only spend it on certain closing costs, like:
- Appraisal fees
- Buying points on your mortgage
- Escrow fees
- Loan origination fees
- Transfer fees
Whether your agent or their brokerage offers a built-in rebate or you negotiate one yourself, the rebate amount should be specified and agreed upon at the outset, before you start touring houses.
A few important notes about buyer rebates
- Real estate rebates must be disclosed to and approved by your lender.
- The promised rebate amount is never guaranteed in full.
- The lender typically dictates how your rebate can be spent.
- Rebates can’t be used to fund your down payment.
Advantages of cash back over commission rebates
We recommend looking for a real estate company or brokerage that offers cash back instead of commission rebates. Cash back comes in the form of a check after closing instead of a credit, which offers some big advantages.
Because you get cash back after the transaction, you can spend it however you want with no limitations.
Cash back isn’t subject to the same rules — i.e., lender approval — because it’s coming from a third-party outside of the transaction.
Even still, you should let your lender know you’re getting cash back just to be safe.
Real estate commission fees and rebates, explained
Commission rebates come out of the commission fee your agent earns on your purchase. So to understand how rebates work, you really need to understand how realtor fees work.
In a conventional real estate transaction, the seller will be on the hook for a total commission of about 6% of the final sale price. The two agents involved in the deal typically split the total commission:
- 3% goes to the seller’s agent, for marketing the home.
- 3% goes to the buyer’s agent, for bringing their client to purchase the home.
Your rebate is a portion of your agent’s 3% cut of the total commission fee.
So if your real estate agent promised you a 50% rebate of their commission, that’d be equivalent to 1.5% of the final sale price.
Or conversely, if your agent promised you 1% of the final sale price, that’d be roughly 33% of their commission.
It’s important to clarify with your agent up front whether the rebate percentage they’re offering refers to their commission fee or the home’s sale price. Using the example of a $300,000 home below, the higher percentage doesn’t always equal the higher rebate.
|Rebate type||Agent's commission||Your home buyer rebate|
|0.5% home price rebate||$9,000||$1,500|
|10% agent commission rebate||$9,000||$900|
How much can you save with a home buyer rebate?
Home buyer rebates can potentially save you thousands of dollars when you purchase a new home.
How much you’ll save depends on the purchase price and the structure of the rebate.
Use this table to get a better idea of just what a home buyer rebate would look like at different price points:
|Purchase price||Potential savings (with 0.5% home rebate)|
The U.S. Department of Justice has a realtor rebate calculator you can use to figure out your exact rebate amount.
Unfortunately, there are no guarantees when it comes to your rebate. While a company or agent may advertise a certain percentage, the lender could ultimately reduce that amount — or reject the rebate entirely!
Cash back, on the other hand, flows through a third party and is refunded after the transaction. As such, it’s usually not an issue for the lender. If you qualify for a cash back program, you’ll likely receive the full, promised amount and be able to spend it however you’d like. This makes cash back a better choice for most buyers.
Why do buyer’s agents offer commission rebates?
Buyer’s agents offer commission rebates to:
- Attract and retain new customers. Buyers may be more inclined to work with an agent who promises they’ll get several thousand dollars back. And since most buyers don’t sign exclusive contracts with their agents until they submit an offer, rebates provide more incentive for a buyer to stick with an agent throughout the process rather than shopping for houses with multiple agents.
- Make a transaction more affordable. Closing costs can be expensive. For buyers, they’re usually 3-5% of the sale price. On a $300,000 home, that’s as much as $15,000. A buyer who gets thousands of dollars back may be better able to afford these costs.
- Remain competitive. A growing number of companies offer buyer rebates. Agents may feel they need to do the same to avoid losing business.
How to negotiate a buyer rebate with your agent
Negotiating a buyer rebate on your own is possible, but it’s difficult to do if the agent isn’t already offering one. We recommend finding a real estate company that offers built-in rebates or cash back instead.
You have better odds of negotiating a home buyer rebate if you’re:
- Purchasing a high-priced home, as your agent will receive a large commission
- Working with a newer agent who may find it more difficult to attract customers
- Buying and selling a property with the same agent, so they’ll be getting both commissions
- Buying in an area where demand is low and your agent may not have a lot of other business
Many agents are resistant to offering commission rebates because it means they earn less money. They may not think it’s worth their time.
How to increase your chances of a real estate rebate
To maximize your chances of successfully negotiating a real estate rebate with your agent:
- Do some of the legwork for your agent. If you’ve already done the hard work of finding a property and you just need help making an offer, an agent may be willing to reduce their commission in the form of a rebate.
- Use the same agent to sell your property. Since the agent will earn a commission for both transactions, they may be more willing to offer a discount.
- Buy a property the agent is selling. Dual agency isn’t legal in every state, though, and there’s an inherent conflict of interest since the agent represents the seller too. Make sure you fully understand the risks before agreeing to a dual agency sale!
Is trying to negotiate a realtor rebate worth it?
Even if you check all the above boxes, there’s still no guarantee you’ll get a realtor rebate. In fact, unless your agent markets commission rebates, chances are they won’t be willing to give up any of their fees.
The good news is, you don’t have to negotiate a buyer rebate on your own. Instead, you can work with a company like Clever that offers guaranteed cash back after your sale closes.
Unlike home buyer rebates, Clever Cash Back comes as a check after closing, and you can spend it any way you like.
Plus, it’s guaranteed on eligible purchases, meaning you don’t have to meet lender restrictions like you do with rebates.
Where are home buyer rebates legal?
Home buyer rebates are legal in 42 out of 50 states.
If you live in these states, you can work with an agent that offers a rebate, try to negotiate for a rebate, or work with a company that offers rebates or cash back.
Some states do limit the size and type of rebate, so it’s important to check the regulations in your specific state.
States where home buyer rebates are banned
The real estate lobby has pushed to have rebates banned in eight states, including:
In these states, agents can’t offer you money back or any type of gift to entice you to use their services.
The U.S. Department of Justice takes the position that blocking rebates inflates the cost of real estate services and harms consumers. That’s why it supports legalizing rebates across the country.
Iowa and home buyer rebates
Iowa technically allows buyer rebates, but it limits them to dual agency sales. Dual agency is when one agent represents both the seller and buyer.
These types of transactions are often suspect because the agent isn’t neutral. The agent will also be looking out for the seller, meaning you may not get the best deal.
Even where legal, buyer rebates are often highly regulated
Even in states that allow buyer rebates, they’re still governed by strict rules and regulations.
For example, you can never use a rebate to fund your down payment. Your lender will have additional stipulations.
Home rebates depend on your lender
Your lender has the ultimate say on whether you can have a home buyer rebate. That’s because a buyer rebate affects the cost basis of your home.
What is the cost basis?
The cost basis is the total amount you pay for your home. It includes the sale price, fees you paid during closing, and any other financial investments you make in the home.
Your rebate cancels out some closing costs, lowering the cost basis of your home.
Lenders use the cost basis to calculate your loan-to-value (LTV) ratio, which is the amount you borrowed compared to the value of your home. You can calculate it by dividing the amount of your loan by the cost basis of your home.
If your LTV ratio changes, your lender will need to adjust your financing to keep the ratio low. Ideally, lenders like to keep the LTV ratio at 80% or lower.
Here’s a quick example of how a $5,000 commission rebate on a home that costs $250,000 can make your LTV ratio too high.
|Home buyer rebate||Loan amount||Cost basis||LTV ratio|
|$0||$200,000||$250,000||80% (just right)|
|$5,000||$200,000||$245,000||81.6% (too high)|
Not disclosing a rebate can result in your financing falling through, or in worst case scenarios, mortgage fraud.
Cash back isn’t as regulated
When a realtor gives cash back to the buyer, the rebate doesn’t cause these issues since it’s distributed after closing. It doesn’t affect the cost basis or LTV ratio, so it’s usually not a concern for lenders.
You won’t have the chance to use it on closing costs, but it’s a nice way to replenish your bank account afterward.
While cash back technically takes place outside of the transaction and, therefore, doesn’t really fall under your lender’s purview, it’s still a good idea to disclose it to them, just in case.
Buyer rebates must be disclosed on your HUD-1 settlement form
If you’re getting a rebate as a closing credit, you also need to disclose it on the HUD-1 settlement form, which covers all settlement costs.
Your agent can help you figure this out. All of the rebate info goes on lines 204-209. You’ll also include the name of the person issuing the rebate, which is typically your agent and/or their broker.
Are home buyer rebates taxable?
According to the IRS, home buyer rebates aren’t taxable.
That’s because you aren’t actually getting any income with a rebate. It’s money you already had, just coming back to you at the end of the transaction.
That said, real estate agent rebates could affect your taxes through cost basis. This is all the money you’ve put into a home.
Taking a rebate lowers the cost basis, which could affect capital gains taxes.
What are capital gains taxes?
This is the amount of taxes you pay on the increase in your property’s value since you bought it.
A lower cost basis up front can make it seem like your property gained more value than it really did, increasing taxes in the future.
Still, this tax increase should be pretty minimal. Also, you may be eligible for an exemption on capital gains from your main home on up to $500,000 in gains. If you’re concerned, talk with a tax professional to get advice about your specific situation.
First-time home buyer rebates vs. regular commission rebates
First-time home buyer rebates are different from the realtor commission rebates we’ve been focusing on in this piece. These rebates are offered by the state or federal government to help people purchase their first property.
The Housing and Economic Recovery Act created a federal tax credit of $7,500 for first-time home buyers, but this benefit expired in 2010.
Now, you’ll need to look a little harder to find a tax credit, grants, and other assistance for your first home purchase. Some options include:
- No-penalty IRA withdrawal: You can withdraw up to $10,000 from your IRA for a home purchase without the 10% penalty for early withdrawal.
- HUD grants: The U.S. Department of Housing and Urban Development (HUD) funds non-profit organizations across the country that can help you with buying a house if you meet certain criteria.
- FHA loans: The Federal Housing Administration (FHA) offers FHA loans to new homebuyers. These loans require a lower down payment than traditional loans and may come with lower interest rates.
- State-specific programs: Each state has its own programs to help first-time home buyers. Check with your state housing finance agency to see what’s available where you live.
You may be able to get both first-time home buyer rebates and normal home buyer rebates as long as you work with an eligible agent or real estate company.
Save on your next purchase
Rebates can potentially save you thousands of dollars, which is a great thing. But, there’s a lot of red tape and you shouldn’t necessarily bank on them.
That’s why it’s better to look for a company offering cash back, which is easier and more reliable.
Either way, savings like buyer’s agent rebates and cash back refunds are becoming increasingly commonplace. You should seek out opportunities like these if you’re in a state that allows it.
For cash back, Clever Cash Back is our top pick because you save thousands without needing approval from your lender.
See if you qualify for cash back, get free advice on your home purchase, and get connected with a top-rated agent in your area when you reach out to our friends at Clever today.
FAQ about home buyer rebates
Can a real estate agent give part of their commission to the buyer?
Yes. Commission rebates are allowed in 42 states, and many realtors offer them to buyers to win their business. Getting a rebate could save you a lot of money. On a $500,000 home, a 0.5% refund would put $2,500 back in your pocket. Find the best home buyer rebate programs here.
What real estate company offers the best home buyer rebate?
Clever Real Estate, UpNest, and Redfin offer the best home buyer rebates available nationwide. But depending on your location, experience buying real estate, and budget, another company's rebate program may be a better fit for your situation. See our full list of the top realtor rebates.
What are home buyer rebates?
A home buyer rebate is when a real estate agent or brokerage shares a portion of their commission with a buyer as an incentive to win the customer's business.
How does a buyer rebate work?
A buyer rebate is usually issued as closing credits. With closing credits, you'll get a discount on some of your closing costs, but you're limited in how you can use them. That's why we prefer cash back. With cash back, you'll get a check after your home purchase is finalized, which you can spend however you want. Learn about our top pick for real estate companies offering cash back for buyers.
Can a realtor who offers rebates give you the money back as cash?
While real estate agents themselves usually don't offer cash back, they can partner with companies that do. In this scenario, the real estate company will give you part of the agent's referral fee (paid to them from the agent's commission). Unlike home buyer rebates, cash back flows through a third party and is issued after the sale, so it doesn't have as many restrictions, and you can spend it however you want.
How can a commission rebate help you buy a bigger home?
Since you can use a commission rebate to cover your closing costs, you might be able to put more of your own money toward your down payment. Theoretically, this could help you afford a larger home. However, because commission rebates aren't guaranteed, it's not something you should bank on.
Is a home buyer rebate taxable?
If you’re interested in learning more about buying and selling homes, these additional resources can help.
The 10 Best Home Buying Websites for 2021 (And Beyond): Zillow, Homes.com, and RealtyTrac are among the top 10 websites for home buyers. Learn about these and other websites that can help you find your perfect property.
Realtor Fees: Your Questions, Answered: Find out who pays real estate fees, how much they cost, and more in this helpful guide to the costs of working with a real estate professional.
Buyer’s Agents: What They Are & What They Do for Home Buyers: Buyer’s agents offer important assistance when looking for a property and making an offer. Learn how a buyer’s agent can help you throughout your purchase process.
Millennial Home Buyer Report (2022 Data): We surveyed 1,000 home buyers to learn about their plans, dreams, and anxieties — including the risks they’re willing to take in order to purchase a home.