Listing contract

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The listing contract (or listing agreement ) is a contract between a real estate broker and a real property owner that gives the broker the authority to act as the owner's agent in the sale of the property.

If the broker is a member of the National Association of Realtors, the agreement must include all of the following conditions:

1. Start date and termination date.
2. The selling price in which the property will be offered for sale.
3. The amount of compensation offered to the broker, either in the form of a fixed cost or a percentage of the sale price.
4. The terms and conditions under which the broker's fees will be paid by the seller.
5. Authorize brokers to cooperate with other brokers as sub-agents or buyer agents and details of compensation to be offered to such brokers in the event that they obtain a buyer.
6. Allow the broker to reveal or not disclose the existence of previously accepted offers.

In addition, other terms that may appear in the agreement may include:

• Authorize brokers to post alerts, to advertise properties, and to place lock boxes on doors, as well as seller obligations to notify brokers about property conditions, and broker obligations to advise sellers about rules and regulations which can affect sales.

Typically, separate listing agreements exist for the sale of residential property, for land, and for commercial or business property.

After listing the property, the real estate agent tries to get the buyer for the property and, with consideration of finding a satisfactory buyer, the broker anticipates receiving a commission (fee) for the broker provided service.

Video Listing contract

Payment of commissions or fees

Although contract terms may vary, usually commission payments (or fees) to the broker are dependent on:

• successful negotiation of a satisfactory purchase contract between the buyer and seller and the ability and willingness of the buyer to close the transaction, or
• find satisfactory buyers who are ready, willing, and able to pay the full list price (or more) for real estate to sell without any possibility.

If the seller refuses to sell real estate when either of the above two conditions apply, it is usually assumed that the real estate agent has done their job to find a satisfactory buyer and the seller must still pay the commission, even though the details are determined. by a listing contract. Unless the closing (or "completion" or "escrow closure", as it is known in some parts of the country) is a condition of the listing agreement, the failure of the buyer to complete the transaction may not require the seller to pay commissions to the broker.

Commissions are usually a percentage of the sale price of a property ranging from 2 or 3% to about 10%, but usually in the range of about 3 - 7% for home. The commission can also be a fixed or combined fee between a fixed fee and a percentage, based on the rate you negotiate. Commission rates and fees are negotiated and not regulated. The average days for sale in your marketplace, advertising, labor costs, time periods, and competition can affect the acceptable level of a real estate broker list before entering a listing agreement.

This commission is paid by the seller to the real estate broker listings, which will then compensate their listing agent and the broker/cooperating agent of this commission by a separate agreement with them.

Maps Listing contract

Price list and final contract price

The listing contract usually also includes the selling price for the property and the expiration date when the contract expires. However, if the property is sold at a lower or higher price, the seller pays a commission on a proportionate amount lower or higher. If the seller does not receive a lower price than the sale price, then the broker must wait until satisfactory sales to earn commissions.

If multiple offers are presented, the seller can accept which offer works best for him, even if the price is not the highest. Percentage commissions will be paid according to the price received. Sellers, often in agreement with a real estate agent, may opt to receive an offer lower than the highest bid for various reasons, such as terms or contingencies in the offered purchase contract or perceived differences in competing buyer's financial qualifications.

Typically, a real estate agent has the experience and data to determine the appropriate selling price for the seller's property and will recommend the selling price to the seller. Seller may accept, reject, or attempt to negotiate a different listing price for the contract. If the seller's price is too high and the agent can not convince the seller otherwise, the agent may refuse to include the property.

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Expiry date

Registering property usually incurs certain fees for broker listings and takes time and effort to seller the listing. To make it worthwhile, they want a certain minimum time period to have a good chance of selling the property. However, the listing contract must have an expiration date. Typical recording periods are usually three to six months. If the property is not sold or under a purchase contract at that time, the seller may decide to re-register the property, possibly with a different listing price, with the same or different broker or agent, or not listing it at all. Listing of properties may begin at a later date than the date the listing contract is signed to allow the time the seller prepares the property to display or sell.

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Type of list contract

There are several types of listing contracts:

• Exclusive rights to sell : Seller has to pay broker's commission if, on the expiry date of the listing contract, real estate is sold, regardless of whether the buyer is obtained through the agent or not. Even if the seller finds the buyer itself, the commission is still owed to the broker. In addition, the seller can not list properties with any other brokers until the list ends with unsold properties.

A REALTOR Broker and, as such, a NAR member must enter the property into the local MLS system and offer compensation to the cooperating broker.

• Exclusive Agents : Seller may only register property with one broker until the listing contract expires with unsold property. The seller must pay a commission to the broker if the real estate is sold to the buyer obtained through the broker. By agreement, if the seller finds the buyer himself, the seller does not have to pay a commission. Since there will be no cooperative brokers involved, the property will not be registered in MLS.
• Open Agency : Sellers may enter into agreements to sell their property with more than one broker in the open agency list. The seller must pay a commission only to brokers who bring buyers to real estate. Usually, if the seller finds his own buyer, the seller does not have to pay a commission.

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See also

• Real estate transactions

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References

Source of the article : Wikipedia