brokerage house that executes orders to buy and sell securities at commission rates sharply lower than those charged by a full-service broker .

brokerage house that executes orders to buy and sell securities at commission rates lower than those charged by a full-service broker

a licensed broker who provides brokerage services for a lower commission than that typical in the market. Generally, the services provided are less extensive than those of a full service broker or may be unbundled, so that a client may contract for specific services. Many discount brokers charge a flat fee rather than a percentage of the selling price.

Example: Henson, a discount broker, offers to list a property for a 3% commission. Henson will refer prospective buyers to the seller and prepare a sales contract. The seller is expected to show the property and negotiate directly with the buyer.