What You Need to Know
Before Signing a Listing Agreement

What Is a Listing Agreement?

According to UpNest, a listing agreement is a contract between a real estate agent and a property owner that authorizes the real estate agent to sell the home. There are three different types of listening agreements: an open listing, an exclusive agency listing, and an exclusive right-to-sell listing. Make sure that you know which of these you are signing up for when you sign a listing agreement.

Open Listing Agreement

An open listing agreement means that the commission goes to the person who brings in the buyer. If this is the listing agent, they get the commission. If you find a buyer on your own, you get to keep the commission

Exclusive Agency Listing Agreement

An exclusive agency listing agreement also allows a seller to find their own buyer without the listing agent receiving a commission, but the listing agent is also the only broker agent who can sell the home.

Exclusive Right to Sell Listing Agreement

An exclusive right to sell listing agreement is the most common, and allows the realtor to have control over the listing. They are guaranteed to receive their commission, and it is their responsibility to list the home, market the home, and more.

Details of a Listing Agreement

A listing agreement is very detailed. It will include things like the type of listing agreement, the expiration date of the listing agreement, the commission amount, the rights of the real estate agent when it comes to marketing, and more. It is important to make sure that your listing agreement has a protection clause, which prevents the seller from not paying an agent commission.

One of the most important aspects of a listing agreement that you should pay attention to is the list price itself. This is something that you and your real estate agent will work together on to determine the worth of your house. The real estate agent will lay out their strategy and reasoning behind a certain listing price and can tell you why they believe you should price the house in a certain way to make the most profit.

Conclusion

Overall, it is important to read your listing agreement thoroughly and ask your real estate questions about the details of the transaction. Make sure that you understand the type of listing agreement that you are signing before proceeding.