Commission split refers to how commission is divided among the parties who earn it. The term is used in two related senses: the split between the listing brokerage and the buyer's brokerage, and the split between an individual agent and the brokerage they work for.
When an agent closes a deal, their share of the commission is divided with their brokerage according to their agreement, which might be a percentage split like 70/30 or a different arrangement such as a flat fee or a cap. More experienced or higher-producing agents often negotiate more favorable splits.
Understanding splits matters because the headline commission is rarely what an individual agent takes home. After brokerage splits, franchise fees, and business expenses, the agent's net can be considerably lower.