Contingent Fee


A contingent fee is a fee that someone must pay if and when a certain event happens. A very common example of this is the fee earned by an agent upon closing a real estate transaction. This fee is contingent on the final sale of the property, and it is part of the contract a seller signs when asking a real estate agent to sell a piece of property as well as part of the sales contract both the buyer and the seller sign. As part of the closing process, the title company disperses the fee to the real estate agent involved in the transaction. This fee will not happen if the sale does not go through, so a real estate agent has a real stake in thoroughly completing the transaction.