Listing Contracts

If you are going to be selling your home, a real estate listing contract is something that you will need to become familiar with. You will not need to use a listing contract if you are selling your home by owner, but this only equals a small amount of the population. For the majority of people that sell their home with the help of a real estate agent, a listing contract is an absolute must. Before you get started, you will need to know what a real estate listing contract consists of. Basically, a real estate listing contract gives a broker or agent the authorization to work on your behalf during the selling process of your home. When you sign a real estate listing contract, you are giving somebody else permission to help you sell your home. If you plan on hiring a real estate agent, a listing contract is an absolute must; there is no way around this. Not every real estate listing contract is the same, but most of them have some general terms that are similar.

Employment Portion

The employment part of a real estate listing contract outlines all of the details of the services that will be rendered. In addition, this part of the contract gives the agent the right to represent you when selling your home. This is more or less a personal service contract between you and the broker or agent.

 

Compensation Portion

If you are going to have a legally valid real estate listing contract compensation terms must be outlined. In this portion of the contract you will find information on how much you will have to pay the broker or agent, as well as when it is due to them. Make sure that you know every detail of the financial set up. Some real estate listing contracts will state that the broker or agent receives money even if they do not sell the home. Would you be comfortable with this? If not, you will want to make sure that this gets straightened out before moving forward. Never sign a listing contract unless you are 100% positive that it is what you want.

Termination Portion

You will always want to make sure that there is a termination clause in any real estate listing contract that you sign. This way if the broker or agent does not live up to your expectations you can simply move on. Any contract that does not have a termination date is a bad one. You should stay away from these at all costs. The most common duration of a real estate listing contract is 180 days, or six months.

Overall, a real estate listing contract is a must have if you are going to be working with a real estate agent. This type of contract will help to protect both parties during the selling process.