You have an obligation under Article 1 of the Code of Ethics (SOP 1-12) to advise sellers of how your firm cooperates and compensates buyer’s brokers.  Part of that explanation will include how compensation works through MLS. As Participants and Subscribers in an MLS, explain carefully that:

• The seller negotiates a percent of the sales price to pay the listing firm for marketing the property.
• Of the total that the listing broker is paid by the seller, the listing broker agrees to share a portion with a buyer’s broker through the offer of compensation in MLS.
• The seller does not participate in determining the amount the listing broker agrees to share with a buyer’s broker through MLS, although the amount must be disclosed to the seller (Article 3, SOP 3-1)

The other part of the compensation explanation involves compensation that might be requested outside MLS and through the purchase agreement between the buyer and seller.  Explain to sellers that a Buyer who brings an offer might have an exclusive buyer representation agreement with a Broker and that the amount of compensation offered by the listing broker through MLS might not satisfy the amount of compensation agreed to in the buyer representation agreement.  In that case, a buyer might ask the seller for a concession through the purchase agreement to pay his broker the difference between the amount agreed to in the buyer representation agreement and the amount the listing broker is offering through MLS. (This negotiated term in the offer (seller to pay buyer) in no way interferes with the offer of compensation by the listing broker through MLS).