Are you thinking about starting up a real estate sales business? If so, you’re going to be looking for houses to buy to sell to clients.
Given the financial resources required to run a real estate business, you must seek the best deals on houses you can find. As such, you must have legal agreements in place to ensure that you’re always protected.
One such legal document is the exclusive right to sell listing agreement. In this article, what we’ll look at is what it involves and why you need one. That way, you’ll know that you’re never breaking the law in this business.
Definition of Exclusive Right To Sell Listing Agreement
An exclusive right to sell is an agreement with a contract between the real estate agent and the owner of the property that gives the agent the right to list the home for sale and receive a commission on the sale.
The agreement also gives the agent the exclusive right to market and sell the home, meaning that the homeowner cannot sell the home themselves or work with another agent. This type of agreement is most common in residential real estate transactions.
How Does an Exclusive Right To Sell Listing Agreement Protect Both Parties?
The owner agrees to pay the agent a commission if the property is sold during the term of the agreement. This type of agreement is beneficial to the agent because it ensures that they will be paid for their work, even if the property is sold by the owner themselves. The agreement as well protects the homeowner by ensuring that they will not have to pay a commission to the agent unless the property is sold.
What Happens if There Is No Exclusive Right to Sell Agreement?
If there is no exclusive right to sell listing agreement in a house sale, the seller is not obligated to pay a commission to the listing broker. The listing broker may still choose to market the property, but is not required to do so. The property may be sold by the seller or another broker.
What Is the Other Option Besides Exclusive Right to Sell Agreement?
The other option besides an exclusive right to sell listing agreement is an open listing agreement. An open listing agreement is a less common listing agreement in which the listing broker is not the exclusive agent of the seller and is not entitled to a commission if the property is sold by another broker.
If you are not sure which option to take, view here for more helpful insights.
Know The Importance of Having an Exclusive Right To Sell Listing Agreement
It’s important to have an exclusive right to sell listing agreement so that you can have peace of mind knowing that your home is being marketed by a licensed professional. This agreement will give you the exclusive right to sell your home and the agent will work hard to get it sold. Make sure to interview a few agents before signing this agreement so that you can find the right one for you.
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