2.3 Permissible Off-MLS Bilateral Negotiations & Agreements
Clarifies how brokerages lawfully negotiate compensation outside the MLS system using bilateral contracts and direct communication channels.
Key 2026 Real Estate Exam Takeaways
- Direct broker-to-broker compensation agreements negotiated completely off the MLS are legal with seller consent.
- Licensees may freely communicate regarding seller concessions or fee intent via phone, text, or email.
- All off-MLS fee sharing agreements must be documented in writing prior to closing (e.g. Form CBC).
It is critical to distinguish between what the federal antitrust settlement prohibited and what it preserved. The settlement eliminated the MLS as a utility for advertising unilateral compensation offers; it did not outlaw bilateral negotiations or commission sharing between licensed real estate professionals.
Listing brokerages and buyer brokerages remain fully entitled to enter into direct, off-MLS bilateral compensation agreements (such as California CAR Form CBC or Texas Form TXR-2402). Under these agreements, the listing broker agrees to pay a specified fee or share a portion of their total earned commission with the buyer's broker at settlement, provided the seller has authorized this arrangement in the listing contract.
Moreover, direct communication between agents outside the MLS is completely lawful. Before submitting an offer, a buyer's agent may call, text, or email the listing agent to inquire whether the seller has authorized concessions or is willing to consider paying buyer broker fees in an incoming purchase offer.
Can a listing brokerage and a buyer brokerage legally agree that the listing brokerage will share a portion of its commission with the buyer brokerage in a transaction?