Once buyers have gone through the tasks of getting ready to sell their house and finding a good agent, they often sign a listing agreement without having read it. However, it’s important to not only know what it says, but negotiate its terms, as it’s legally binding once signed.
To make sure you won’t have to face consequences later, here are some things to consider in a listing agreement. Make sure you address all of these things before you’ve signed anything.
Listing Period
It’s advisable to contract to list your property for about 90 days. This will give you an out if you don’t wish to continue listing with your current agent. Thus, try to avoid extending the listing period beyond the aforementioned three months.
In the same vein, ensure you can always remove your home from the market. Whether you have a change of circumstance or mind, it’s important to be able to stay in your home if that’s what you choose.
Commission
Unfortunately, there may be a situation in which you would like to switch to a different listing agent. If that’s the case, you might still be obligated to pay your first agent for the work that they did initially to sell your house. Make sure you address this, or you could be on the hook for paying two commissions.
Additionally, agree to pay the commission only following the closing of your home and form the profit of that sale. Many agreements stipulate that the commission be paid following obtainment of a “‘ready, willing, and able’” buyer; having the commission be paid at that time may be premature.
Finally, some agreements say that if your home is removed from the market but is later bought by someone who discovered your home while it was listed by the agent, you must pay that agent the commission within six months. You can request to shorten this period of time.
Termination
You may find that the agent or firm you hired is not the best one for you. Therefore, you want to leave yourself the ability to terminate the listing agreement. If the reason is personal, you should give the agent notice. If the reason is a specific cause dealing with cheating, the agreement you formed should be terminated at once.
Extra Fees
Be on the lookout for extra fees included in the agreement, such as document preparation or using the firm’s home inspector. You have a right to omit this from the agreement.
Source: think glink