Fact Pattern: You are a tenant’s agent. You and the tenant are entering into a C.A.R. Tenant Representation and Broker Compensation Agreement (TRBC). The tenant has agreed to pay you a commission of 3% of the total rent payments for a one-year lease.

Multiple Choice Question: Can you indicate on the TRBC that you can get paid up to an extra 5% from the landlord as well? Pick the best answer:

A. Yes.
B. Yes, for certain MLS participants.
C. No, under California law.
D. No. 

Answer: This is a follow-up question to last week’s Legal Tip that addressed when a tenant’s agent is required to obtain a signed tenant-broker agreement. As explained last week, it’s a great idea for all tenants’ agents to get a signed tenant-broker agreement to help ensure that you will get paid. However, some local MLSs, such as CRMLS, require its MLS participants to have a signed tenant-broker agreement before touring a property, whereas others do not (e.g., TheMLS.com/CLAW).

Answer A is wrong. Under CRMLS rules, for example, a tenant’s broker must have a written tenant-broker agreement (see CRMLS Rules 8.5 and 9.1). The agreement must include, among other things, a term that prohibits the tenant’s broker from receiving more than the amount in the agreement, regardless of the source of payment (see Rule 9.1).

That MLS requirement is addressed in C.A.R.’s standard-form Tenant Representation and Broker Compensation Agreement (TRBC). The TRBC states that, “If Broker receives compensation from housing provider, or others, the amount due Broker for representing Tenant shall be credited against Tenant’s obligation to pay Broker” (see paragraph 2D(2)).

Answer B is the correct answer (and Answer D is wrong). MLSs such as TheMLS.com/CLAW do not require a tenant’s agent to have a written tenant-broker agreement (see TheMLS.com Rules 8.3 and 8.8). They also have no rule limiting a tenant agent’s compensation to what’s stated in a written tenant-broker agreement.

However, if you are using the TRBC, you should revise that boilerplate language in paragraph 2D(2) to accommodate this situation. You can add in paragraph 2E, Other Terms, something to the effect of “Concerning paragraph 2D(2), Broker is authorized to receive not only 3% from Tenant, but also up to 5% in additional compensation from housing provider.”

Answer C is wrong. A new 2025 California law generally requires a buyer’s broker to enter into a written buyer-broker agreement as soon as practicable, but no later than the signing of a buyer’s offer to purchase (California Civil Code section 1670.50(a)). This new law does not pertain to tenants’ agents.

-Thank you again to Kayo Yoshida (Beverly Hills Office) for suggesting this week’s legal tip!

Copyright© 2025 Shared Success Center, LLC (serving HomeServices of America companies). All rights reserved. Any unauthorized reproduction or use of this material is strictly prohibited. This information is believed to be accurate as of June 16, 2025. It is not intended as a substitute for legal advice in individual situations, and is not intended to nor does it create a standard of care for real estate professionals. Written by Stella Ling, Esq.