Types of Listing Contracts
There can be several types of listing contracts:
- Exclusive right to sell: The seller must pay the brokerage a commission if, by the expiration date in the listing contract, the real estate is sold, regardless of whether the buyer is obtained through the agency or not. Even if the seller finds the buyer him/herself, a commission is still owed to the brokerage. Furthermore, the seller cannot list the property with any other broker until the listing expires with the property unsold.
- Brokers who are REALTORS and, thus, are members of NAR are obliged to enter the property into the local MLS system and offer compensation to co-operating brokers.
- Exclusive Agency: The seller can only list the property with one brokerage until the listing contract expires with the property unsold. The seller must pay the broker a commission if the real estate is sold to a buyer obtained through that brokerage. By agreement, if the seller finds the buyer him/herself, the seller does not have to pay a commission. Since there will be no co-operating broker involved, the property will not be listed in the MLS.
- Open Agency: A seller can enter into an agreement to sell their property with more than one brokerage in open agency listings. The seller must pay a commission only to the brokerage which brings the buyer for the real estate. Typically, if the seller finds the buyer him/herself, the seller does not have to pay a commission.
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