When an owner of a real estate property wants to sell it, he invites multiple realtors to find potential buyers and along with that, the owner also meets with buyers and shows them the property. In this situation, the owner isn’t required to pay to any realtor unless one brings a buyer that buys the property. The contract signed between the owner of the property and the realtor(s) to negotiate the terms of open listing is known as the open listing realty agreement.
Importance of the open listing realty agreement:
Usually when a person wants to sell his property, he hires a realtor that meets with potential buyers and shows them the house. Whether the buyers buy the house or the realtor keeps them showing the property, the owner has to pay a certain price as salary to the realtor but not with open listings. This is a better situation where the owner can meet with buyers and show them the house by himself. So, the owner hires more than one realtor to find buyers for a property meanwhile, the owner also meets with buyers by himself and tries to fix a deal. When a realtor brings a buyer that actually buys the house, the owner is obligated to pay a certain percentage of the payment to that particular realtor but not to others who were hired for the same purpose. If the owner sells the property by himself, he doesn’t need to pay commission to any realtor as no one got a buyer who actually bought the property.
The legal contract that includes all these terms and conditions is known as the open listing realty agreement. There are many important elements that we can discuss about this agreement. For example, one of the key purpose of this agreement is to allow the owner to make the property open so that any buyer can walk in and meet with the owner without involving any realtor and even if the owner has hired realtors for this purpose, when they sign this agreement, they can’t ask the owner for any money if he sells the property by himself. Another important element of this agreement is that if a realtor sells the house, he has to agree to a certain amount of commission and the owner has to pay the commission to the realtor.
Useful tips for writing open listing realty agreement:
There are many important elements that you need to include in this agreement but the most important ones include; the name of each realtor that you hire for selling the property, the details of the property, the percentage of the commission that you will pay to the realtor who actually sells the property, the term that no other realtor will get paid, the clause that the owner won’t pay any realtor if he sells the property by himself and most importantly, the right of the owner to meet with the clients and try to sell the property without including any realtor. If you make sure all these elements are included in the agreement, you have got yourself a legal open listing realty agreement.
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