Types of Agency Listing Contracts
By Anjana Appanna
When you are looking to sell your home it is essential that you are familiar with the different types of listing contracts you may have with your agent. Know your options before you approach a real estate agent to sell your home. There are primarily four types of real estate listing contracts, and each has its pros and cons. Through a brief study of the types of contracts, you can arrive on the one that is most suitable to you and your property.
As the name suggests this type of listing with the agent is completely non - exclusive. Open listing is best suited when the seller does not want to be committed to one agent, or when you want the option of selling the home on your own. With this type of listing contract the agent is entitled to a full commission if his potential buyer's deal goes through. This being a non - exclusive type of listing has its disadvantages. The agent may not take such a keen interest in marketing your home as is the case with an exclusive contract because here any agent can find you a buyer. However the large advantage of the open listing contract is that you can find a buyer on your own, and hence save on the cost of the agent's commission .
This type of listing contract is very similar to an Open Listing and is most often used by real estate agents to show an FSBO (For Sale By owner) home to their client. The home owner signs an agreement, which identifies the potential buyer and guarantees the agent a full commission should that particular buyer purchase the home .
Exclusive Agency Listing
The third type of contract is the Exclusive Agency Listing contract. This contract ensures that whichever agent or agency you sign with is entitled to the commission even if the final buyer is brought in by another agent. However if you sell the property on your own then the agent does not earn a commission. The Exclusive Agency Listing is not very popular with most real estate agents because of its scope for unethical behavior by the seller.
Exclusive Right to Sell
Exclusive Right to Sell entrusts your real estate agent with full responsibility and the exclusive right to sell your home. Despite the active interest you may take to sell your own home and its success, your listing agent is entitled to his full commission. This kind of listing acts as an incentive to the agent to take keen interest in the marketing and eventual selling of your property.
Before you sign the final contract with your chosen agency, make sure you are fully aware of all the types of contracts available to you. Pick the listing contract that is most convenient to you, enabling you to make a better sale.
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