Listing Agreement
legally binding contract that creates an agency relationship authorizing a broker to serve as the agent for a principal in a rela estate transaction
Most listings are
bilateral - meaning a buyer or seller promises to pay a commission in exchange for the broker's promise to locate a "ready, willing and able" buyer for the seller or a suitable property for the buyer.
Listing agreements must
be in writing to be enforceable. Oral listings do not give the broker legal protection. If the listing agreement is not in writing, a broker could not collect the commission if a seller refused to pay.
Most common types of listings are:
- Open listing (buyer and seller)
- Exclusive-Authorization-and-Right-To-Sell (Seller)
- Exclusive Agency (Seller)
- Net Listing (Seller)
- Exclusive-Authorization-To-Acquire Property (Buyer)
Open Listing
non-exclusive contract, authorizing a broker to serve as the agent for either the sale or the purchase of property. a broker is not under the same obligation to perform as with other listing agreements, so it is considered a unilateral contact
- Gives the
Exclusive-Authorization-and-Right-To-Sell
MOST COMMON. broker has exclusive right to market the property for a specified period of time. If the property sells while the broker has the listing, the seller must pay the agreed upon commission, regardless of who procured the buyer. Agent is more will
ALL EXCLUSIVE LISTING CONTRACTS MUST CONTAIN A
definite termination date. A licensee could be subject to disciplinary acton for receiving a commission for a transaction if the agreement did not have a definite end date. Seller must also refuse to pay fee if the listing contract doesn't have a definite
Exclusive Agency
Gives one broker the exclusive right to market and sell the property, while the owner retains the right to find a buyer and sell the property without owing the broker a commission. The seller pays commission only if the home is sold by the broker or an au
Exclusive-Authorization-To-Acquire-Property
authorizes the broker to act as the agent of the buyer. Broker owes the same duties and responsibilities to the buyer as a listing agent owes to a seller. The commission is negotiable and this agreement must also specify a definite termination date. The c
Check Your Understanding
1) What is an important thing to remember about listing agreements?
- They must be in writing to be enforceable.
2) Describe an open listing
- An open listing is non-exclusive listing that allows a seller or buyer to engage a number of different brokers t
Residential listing Agreement
The listing agreement that you probably will use most frequently. It is a legal, binding contract.
Residential Listing Agreement - Exclusive Right to Sell (Para.1)
- name of the owner
- Name of the real estate office that is obtaining the listing
- beginning and ending dates of the listing period
- physical address of the property, including city, and county
- May need to attach a signed copy of a legal description.
Residential Listing Agreement - Items included and Excluded (Paragraph 2)
- List any personal property that may be included as part of the sale
- Or any real or personal property that is excluded from the sale.
- This will avoid misunderstandings later
Residential Listing Agreement - Listing Price and Terms (Para. 3)
- Indicate the asking price of the property.
- A space to indicate any financing terms, such as loan assumption, down payment amount, all cash, etc.
- UNLESS THE TERMS ARE SPECIFIED, A SELLER IS NOT REQUIRED TO PAY A COMMISSION WHEN REFUSING A FULL PRICE
Residential Listing Agreement - Compensation to Broker (Paragraph 4)
- Subparagraph A is to fill in the mutually agreed upon commission the seller will pay the broker. It can be a percentage or a specific amount
- Subparagraph A-2 is the safety clause. Here the broker and sellers agree to s specific number of days after th
Residential Listing Agreement - Ownership, Title and Authority (Paragraph 5)
Warrants that the owners are the only title-holders of the property and therefore have authorization to sell it
Residential Listing Agreement - Multiple Listing Service (Paragraph 6)
States that the broker will provide the transaction terms to the Multiple Listing Service, unless the seller signs a form to withhold the listing.
Residential Listing Agreement - Seller Representations (Paragraph 7)
Indicates that the seller is unaware of any legal, financial or physical reasons that would affect the seller's ability to sell the property. If seller becomes aware of any such reasons, the seller must notify broker immediately.
Residential Listing Agreement - Broker's and Seller's Duties (Paragraph 8)
Broker agrees to use due diligence to achieve the purpose of the listing agreement. Seller agrees to consider all good faith offers on the property. To make property available for showings, to take responsibility for lal information the seller provides o
Residential Listing Agreement - Deposit (Paragraph 9)
This section authorizes the listing agent to accept and hold any deposits on the seller's behalf which will be applied to the purchase price.
Residential Listing Agreement - Agency Relationships (Paragraph 10)
Explains the broker represents the seller. Broker will not represent the buyer, however if the listing agents find a buyer, it ma be necessary to act as dual agent. Also informs that the broker represents other sellers. Agency relationship must be confirm
Residential Listing Agreement - Security and Insurance (Paragraph 11)
States that the broker is not responsible for loss or damage to the property, even with a lockbox present. The seller must take steps to safeguard any valuables and obtain insurance to cover risks.
Residential Listing Agreement - Keysafe/Lockbox
defines a lockbox and states that persons using the lockbox are not insured against theft, damage, vandalism, etc. that could be attributed to lockbox use. A check box to check whether he or she does not want a lockbox used.
Residential Listing Agreement - Sign (Paragraph 13)
Seller checks if he or she does not ant a sign on the property
Residential Listing Agreement - Equal Housing Opportunity (Paragraph 14)
States that the property is offered in compliance with all anti-discrimination laws.
Residential Listing Agreement - Attorney Fees (Paragraph 15)
States that the loser of a suit or arbitration of any disagreement must pay the associated costs.
Residential Listing Agreement - Additional Terms (Paragraph 16)
Provides space for any agreement or terms not covered by any other section, such as a seller paying for a termite report.
Residential Listing Agreement - Management Approval (Paragraph 17)
States that if an associate licensee entered into this agreement, the broker as a right to cancel within 5 days.
Residential Listing Agreement - Successors and Assigns (Paragraph 18)
States that the agreement is binding on the seller and the seller's successions and assigns.
Residential Listing Agreement - Dispute Resolution (Paragraph 19)
Subparagraph A - the broker and seller agree to mediate any disputes that arise form this agreement before taking any other action.
Subparagraph B - Explains arbitration, but arbitration will not be executed unless both the broker and seller have initiale
Residential Listing Agreement - Entire Contract (Paragraph 20)
States this agreement supersedes all previous discussions, negotiations and agreement between the seller and the broker. Therefore, anything that is not written into this agreement is not part of the agreement
Residential Listing Agreement - Signature Section
All sellers must sign and date the agreement nd provide their addresses, and other available info. Then your firm's name, your name directly below and then provide info about the firm.
CALIFORNIA LAW REQUIRES THAT THE SELLERS RECEIVE A COPY OF THE LISTING
Seller also needs information about required disclosures and forms that are part of the selling process so it would be wise to put together a listing packet to leave with your sellers.
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Listing Packet Forms
California Association of REALTORS has many standardized forms that will make the compilation of a listing packet much easier.List of items you should include:
- Completed Residential Listing Agreement (RLA): This is the listing that was in much detail. T
-Check Your Understanding
1) What does the safety clause in the listing agreement do?
- Allows broker to receive a commission under certain conditions if he or she sells the property within a specified number of days after the listing contract expires.
2) What does the security an
Which of the following statemebts us is not true about a net listing?
Sets a limit on the commission a broker can ear.
Is generally viewed as unprofessional
Is illegal in many states
ALLOWS A BROKER TO HAVE AS A COMMISSION ANYTHING ABOVE THE MINIMUM THE SELLER SETS.
Which of these documents is for sellers only and not for buyers?
Smoke Detector Statement of Compliance
Real Estate Transfer Disclosure
Residential Listing Agreement
SELLER'S AFFIDAVIT OF NONFOREIGN STATUS AND/OR CALIFORNIA WITHHOLDING EXEMPTION.