A new Consumer Policy Center (CPC) report found that administrative “junk fees” charged by real estate brokerages to both home buyers and sellers have become widespread, often ranging from $400 to $600 per side and sometimes exceeding $1,000, with some agents calling the charges unethical and refusing to pass them on to clients.

The report, titled “Junk Fees Charged to Both Home Sellers and Buyers: An Overview,” was released Tuesday by the Washington, D.C.-based consumer watch dog organization. It analyzes how so‑called admin or transaction fees are imposed, how often they appear in residential deals, how high they run and how they are disclosed to consumers.

Because there is no comprehensive public data set on these fees, CPC said the findings are based primarily on several hundred comments from real estate agents, brokers and mortgage professionals gathered through direct communication and public posts on platforms including Facebook, TikTok, Reddit and Quora. The authors, Stephen Brobeck and Wendy Gilch, characterize the work as closer to an investigative report than an academic study, but say consistent patterns emerge across markets.

What the report found on fee levels and scope

According to the report, brokerages most commonly label these add‑on charges as “administrative” or “admin” fees but also use terms such as transaction fee, broker service fee, processing fee, technology fee or regulatory compliance fee. The fees are typically imposed by the brokerage on both the listing and buyer sides, with agents expected to pass them through to sellers and buyers.

Agents cited by CPC report that:

• Most home sales in their markets now include an admin-style fee, with some agents estimating that more than 95% of transactions in their state include a fee on both sides.
• Typical charges fall between $400 and $600 per party, though individual fees can be below $200 or above $2,000. Isolated examples reached roughly $2,500.
• At least some agents raise the brokerage’s base fee and retain the difference, or charge a flat fee even when their brokerage does not require one.

CPC estimates that if roughly half of buyers and sellers pay an average $500 charge, the total annual cost to consumers would approach $2 billion. Because these charges are generally flat dollar amounts, the report notes they are regressive, effectively increasing the commission rate more for lower-priced homes than for higher-priced ones.

In one cited example, a $1,590 admin fee on a $412,000 sale increased the effective commission by about 0.40 percentage points, while a $795 fee on a $126,900 home added roughly 0.60 percentage points to the commission rate.

“It is difficult for brokers to justify charging a buyer or seller an admin fee when they are also charging them a 3% commission,” Brobeck, a CPC senior fellow, said in a statement.

“Because the fees are regressive, sometimes effectively increasing the commission rate by over half a percentage point, they hit first-time homebuyers especially hard.”

Disclosure practices under scrutiny

The report says admin fees are increasingly written into buyer-broker agreements and listing contracts, either as a separate line item or as a “plus $X fee” addition to the commission percentage. This shift has accelerated since the National Association of Realtors (NAR) settled the home seller commission lawsuits in 2024, as the settlement pushed more states to require written buyer representation agreements early in the process.

However, the CPC cites accounts from industry professionals that some fees are still introduced late in the transaction. The report describes instances in which agents or brokerages allegedly added admin fees to title or attorney disbursement instructions days or even hours before closing, despite state consumer-protection laws that generally require advance disclosure in agency agreements.

“It appears that in the early stages of the sale, a number of agents are not informing, either verbally or in writing, the imposition of these junk fees,” Gilch, a CPC fellow, said in a statement. “When a consumer learns about the junk fee at a closing, they are under great pressure to approve it.”

Brobeck and Gilch also pointed to a recent class action filed in Florida state court against Compass as an example of potential legal exposure. The suit alleges unfair and deceptive practices tied to a $475 “transaction fee” charged to a buyer and a $495 fee charged to a seller, and argues that the fee was not properly disclosed earlier in the process.

The report argues that private litigation currently appears more likely than regulatory action to change practices around admin fees. While CPC says federal agencies such as the Federal Trade Commission, Department of Justice and Consumer Financial Protection Bureau have not shown strong interest in this specific issue, the group notes that state consumer-protection laws already require clear fee disclosure in most cases.

The CPC also points back to earlier litigation, including Busby v. JRHBW Realty in Alabama, which challenged a separate administrative fee under the Real Estate Settlement Procedures Act. That case ultimately led to a 2014 consent order with the Department of Housing and Urban Development and contributed to industry guidance that such fees must be retained by the brokerage, not paid to third parties, and must be adequately disclosed.

The report suggests that if admin fees continue to rise or remain opaque, state attorneys general could use consumer-protection statutes to issue subpoenas or civil investigative demands, and that multistate actions could follow. For large brokerages with national or multistate footprints, the combination of class actions, state-level enforcement and potential federal scrutiny represents a growing compliance risk.

Agent pushback and changing expectations

While some agents pass the fees on to consumers, the CPC’s review of social media posts found multiple agents who said they waive the fee and pay it out of their own commission to avoid client friction and others who have left or declined to join firms that require the charges.

The CPC reports that some of the harshest criticism of admin fees is coming from inside the industry. Agents quoted in the report and its appendix labeled the charges with terms including “unethical,” “money grab,” “garbage” and “robbery,” and described struggling to justify them to buyers who believed the seller was covering all broker compensation or to sellers already paying 5%–6% commissions.

According to the report, many of those agents say they either routinely waive the fee or left brokerages that required it. One mortgage broker interviewed by CPC estimated that agents personally absorb the charge in about one-quarter of deals.

Fees and consumer protection 

Looking ahead, the CPC suggests the brokers and team leaders should review whether admin or transaction fees are required, optional or prohibited and how that policy is communicated internally. Additionally, the organization said brokers should ensure that all add-on fees are clearly spelled out in buyer and seller agreements, with plain-language explanations that match what appears on loan and closing disclosures and that they should evaluate the impact of flat fees on lower-priced transactions and first-time buyers, where the effective commission increase is highest.

For agents, the CPC said they should work to understand their brokerage’s fee policies and how they align with your value proposition to clients and the organization noted that they should be prepared to discuss whether they charge an admin or transaction fee, as well as when it is disclosed and whether it is negotiable.

In addition, the CPC said agents need to document client consent to any such fees in initial agreements rather than relying on last-minute additions at closing.

This article was written by Brooklee Han and generated with the assistance of HousingWire Automation, then reviewed by a HousingWire editor before publication.