Your home is probably your largest investment, and whether it has gone up or down in value lately, you probably want to keep as much money from the sale as possible. After you pay off your existing mortgage, your real estate commission may be the next largest expense in selling your home. Negotiating the amount you pay to your real estate agent could therefore be the easiest way to save money.

In a typical home sale, each party -- the buyer and the seller -- works with his or her own real estate agent. But it's the seller who generally pays the commission for both real estate agents from the proceeds of the sale. When listing your home with an agent, you have an opportunity to set the amount of commission both agents will receive. The commission is set as a percentage of the home's sales price. A commission of 6% is a standard amount, with each agent receiving 3%.

Reducing your commission as little as .5% could result in big savings -- for example, saving .5% on a $400,000 home sale would be an additional $2,000 in your pocket.

Commission Is Negotiable

Studies have found that sellers who negotiate to cut their real estate commission in half can do so with little risk of getting worse service or a lower selling price. As it turns out, developing the art of negotiation almost always pays off. And the payoff can be big. Just as buyers are strapped for cash and credit, real estate agents are hungry for business, and often willing to find some financial middle ground.

A Consumer Reports survey of more than 9,000 homeowners who sold or attempted to sell their home from 2004 to 2007 found that 71% of those who attempted to negotiate a sales commission succeeded, often netting a 3% to 4% sales commission for the effort. And the bargain commissions didn't come from discount brokers or reduced service outfits, but from traditional brokers, including Century 21, Coldwell Banker, Prudential, Keller Williams, RE/MAX, other companies, and independent agents. RE/MAX agents were most likely to lower commissions, followed by independent agents, but the other brokers weren't far behind.

The price break doesn't translate to poorer service. People who paid lower commissions -- even down to half the usual amount -- enjoyed nearly identical satisfaction with their agent's performance, no matter what company offered the discount. And paying the lower commission "rarely had any effect on the sales price" of the home.

If you have any qualms about asking for a commission break, do the math to give you the nerve. On a $250,000 home, a 6% commission amounts to $15,000, but a 3% commission is only $7,500. The extra $7,500 in your pocket can help leverage a move-up or be all you need for concessions that will lure buyers off the fence.

So, go ahead, haggle.

Six Money-Saving Tips

Focus on choosing an agent, not a real estate company. Most real estate companies market their properties in a similar manner -- for example, listing the property on the appropriate listing service, holding open houses, preparing and distributing brochures, posting photos and virtual tours online, and so on. Instead of focusing on choosing a real estate company, concentrate on ferreting out a top-notch real estate agent. Seek referrals from family, friends, coworkers, and others you trust who've recently enjoyed great service.

Negotiate from a position of power. After you've met with several real estate agents who have compiled comparables and recent sales data to set your home's price, select the agent that you feel will do the best job marketing your home, then ask for a commission break. If the agent's proposed sales price is lower than what you expected, ask the agent to reduce his or her commission to offset some or all of the difference between the proposed sales price and the price you expected. Agents are more apt to give you a discount if they have invested some time and energy in working with you and believe you will be a good client.

Prepare your home. A real estate agent knows he or she will have to work harder if your home isn't "model home" ready and may be less likely to reduce the commission. Add curb appeal to get shoppers excited about the property and spiff up the inside so that it's clutter free, sparkling like a gem, and laid out for easy navigation. Consider spending some of that commission break on a professional stager.

Roll up your sleeves. Consider doing some of the agent's work, much as you would with a discount broker in a hot market. Host your own open house events. You'll need to provide brochures, fliers, and information about the property -- which your agent may prepare for you -- and then get out of the way and let the potential buyers look around. You can refer unanswered questions and bids to the agent.

If you're selling to a family member, friend, or renter and don't need the agent's marketing expertise, a discount is typically a no-brainer.

Sell in the off season. Whether it's the dead of winter in some locales or the pre-school summer doldrums in others, selling in the slowest seasonal periods can be the best times to negotiate a favorable rate of commission. But this must be balanced with the possible negative impact of selling at a time when there are fewer potential buyers. You'll need to carefully weigh these considerations before deciding when to sell.

Don't take "no" for an answer. Go to the top. Seek out the broker, rather than the real estate agent who holds your listing. The broker has the power to pull strings, negotiate his or her cut with the agent, or otherwise help you get a discount.

To learn more about commissions and other things you you need to know about selling a home in California, get For Sale by Owner in California , by California real estate broker George Devine (Nolo).