Real Estate Listing Agreements Overview
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Questions and Answers

What is an open listing?

  • A seller pays a commission only if the agent finds a buyer.
  • Both B and C. (correct)
  • A seller can enter into agreements with one agent only.
  • A seller can enter into agreements with multiple real estate firms.

    • What does an exclusive agency listing agreement entail?

    The seller pays a commission if anyone other than the seller finds the buyer.

    In an exclusive right to sell listing, the seller pays a commission regardless of who finds the buyer.

    True

    What are the four requirements for a valid listing agreement?

    <p>Property description, promise of compensation, fixed compensation figure, written and signed by the seller.</p> Signup and view all the answers

    What happens in a net listing?

    <p>The brokerage keeps the excess above the seller's net amount.</p> Signup and view all the answers

    A listing agreement will terminate if the property is sold.

    <p>True</p> Signup and view all the answers

    How broadly is a sale defined in a listing agreement?

    <p>A sale is defined as including a contract to sell, an exchange, a purchase option, or a lease with an option to purchase.</p> Signup and view all the answers

    The commission rate in a listing agreement can be mandatory.

    <p>False</p> Signup and view all the answers

    What does an extender clause do?

    <p>It requires the seller to pay the agent a commission if a property is sold to someone the agent introduced within a specified period after the agreement expires.</p> Signup and view all the answers

    What is the purpose of a hold harmless clause in a listing agreement?

    <p>The seller agrees to take responsibility for the information provided to the agent.</p> Signup and view all the answers

    All property owners must sign the listing agreement as sellers.

    <p>True</p> Signup and view all the answers

    What is included in MLS listing agreement forms?

    <p>A listing input sheet that describes the property's features using checkboxes and codes.</p> Signup and view all the answers

    Multiple listing services permit changes to the MLS listing agreement form.

    <p>False</p> Signup and view all the answers

    Study Notes

    Listing Agreements Overview

    • Open Listing:

      • Seller can have multiple real estate firms working simultaneously.
      • Commission owed only if the agent is the procuring cause of the sale.
      • Generally disfavored by real estate firms and often prohibited by multiple listing associations.

    • Exclusive Agency Listing:

      • Seller pays commission only if a buyer is found by someone other than the seller.
      • Commission not owed if the seller finds the buyer independently without agent help.

    • Exclusive Right to Sell Listing:

      • Seller pays commission regardless of who finds the buyer.
      • This agreement is common in residential transactions, ensuring the agent is compensated for their efforts.

    • Valid Listing Agreement:

      • Must include a property description, promise of compensation, specify compensation amount, and be in writing with the seller's signature.

    • Net Listing:

      • Seller specifies a net amount desired from the sale.
      • Brokerage retains any amount above the seller's specified net.

    • Termination of Agreement:

      • Terminates on expiration date, closing of sale, or if the brokerage license is suspended or revoked.
      • Mutual termination is possible; unilateral termination may lead to breach of contract liability.

    Definitions and Clauses

    • Definition of Sale:

      • Broad definition includes contracts to sell, exchanges, options to purchase, or leases with purchase options to secure brokerage interests.

    • Commission Rate:

      • Fully negotiable, with no mandated or standard rates enforced.

    • Extender Clause:

      • Ensures the agent receives a commission if the seller sells to an introduced buyer within a specified timeframe after agreement expiration.

    • Hold Harmless Clause:

      • Seller takes responsibility for the accuracy of information provided to the agent, agreeing to cover legal expenses incurred by the brokerage due to seller misinformation.

    Additional Requirements

    • Seller Disclosure Statement:

      • Mandatory in Washington for residential sales, with sellers required to furnish a disclosure statement to agents for buyer distribution.

    • Signatures:

      • All property owners must sign the listing; spouses and authorized individuals (like corporate officers) must also sign if applicable.
      • For estates, the personal representative must sign.

    • Input Sheet:

      • Part of MLS listing agreement that allows agents to detail property features through checkboxes and codes for efficient MLS database entry.

    • Modifications to Form:

      • Generally, MLS does not permit alterations to listing agreement forms; exceptions may occur under specific conditions.

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    Description

    This quiz covers the key types of real estate listing agreements, including Open, Exclusive Agency, and Exclusive Right to Sell listings. It also addresses the legal aspects required for a valid listing agreement. Test your knowledge on how these agreements work and their implications for sellers and agents.

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