Types Of Listing Contracts

There are several type of listing contracts, such as the Exclusive Agency Agreement, the Open Listing Agreement, but, usually the Exclusive Right To Sell Agreement is mostly used.

1.  The Exclusive Right to Sell Agreement

This agreement is between you, and your representing agent and broker.  If you want full services from an agent to be delivered, then this type of listing is normally the only listing agreement that will be accepted.  This gives "exclusive" selling rights to your agent to market your home to other agents and buyers.  This does not mean that other agents will not be previewing your property, it only gives your agent the "exclusive right to sell" for your property, and therefore your agent has more invested to getting your property sold.  Your agent will actively market your property to other agents in your area, and when other agents bring prospective buyers, your agent will represent you and your best interests.  This is the only listing that an agent will realistically be assured of earning anything, even if you or other agents find an actual buyer.  All others types of listings only offer only the possibility of a commission.  Remember, that if the property does not sell, the agent will not be due any commission - this applies to all listing agreements, and of course, barring any up front and agreed to expenses such as high-end marketing, or advertising fees.

2.  The Exclusive Agency Agreement 

This agreement is similar to the "Exclusive Right To Sell Agreement", but gives you the right to find a buyer on your own.  This is not a popular type of agreement as there are unscrupulous buyers who will use an agent to find your property, then try to cut out the agent by going  directly to you!  This creates various legal issues of which the agent's broker probably will be taking you to court to attain their commission, as the agent did his job by bringing the ready, able and willing buyer for your property.  This is also unpopular because if an agent and their company spent time, effort and cost for marketing expenses on your property, then if you find a buyer , their expenses and efforts will be for nothing.  This is probably one of the greater reasons why this agreement is rarely used today.

3.  The Open Listing Agreement 

This agreement is usually one used where property owners feel they can sell the property themselves, but want to employ as many real estate agents as possible in helping them to draw in prospective buyers.  Only when an agent brings the buyer will the agent earn a commission.  This will probably have the lowest appeal and effort from agents, as they know that they are in competition not only with other agents to bring a prospective buyer, but with you the property owner.  Because if anyone else finds a buyer, including you, they will not earn anything for their efforts in trying to find a buyer.  The agent will probably not place your property into the MLS, only show your property only if it specifically matches a buyer's needs and is convenient at the time they are with a prospective buyer.  This type of listing is usually lowest on the agent priority list for selling.