Client Representation Agreements

Question 1

What is a seller representation contract?

Answer 1

A listing (seller representation) contract is a fiduciary contract in which the owner/seller hires a brokerage firm to act as a special agent to find a buyer who is ready, willing, and able to buy according to the terms of the listing contract.

Question 2

T/F

While all listing agreements share some commonalities, state laws determine specific required content.

Answer 2

True

Question 3

What is an excluisive listing?

Answer 3

In an exclusive listing, the seller hires a single brokerage to market and sell the property. An exclusive listing is a bilateral contract. There are two types of exclusive listings: exclusive right to sell and exclusive agency.

Question 4

T/F

Exclusive right-to-sell listing: the listing brokerage is paid a commission if the property sells, regardless of who found the buyer.

Answer 4

True

Question 5

Exclusive agency listing: the listing brokerage is not paid a commission if the seller finds a buyer through the seller’s own efforts. The listing brokerage is paid a commission if the property sells under any other circumstances.
T/F

Answer 5

T

Question 6

What is an open listing?

Answer 6

Open/nonexclusive listing: the seller can sign open contracts with more than one brokerage firm (nonexclusive). Only the brokerage that procures (finds) the buyer is paid. If the property sells, all other open listings are automatically terminated with or without notice. An open listing is a unilateral contract.

Question 7

T/F

Listing brokerages are obligated to promptly present all written offers to the seller, write an offer if so requested by an unrepresented buyer, pay fees only to their own salespersons or other licensed brokerages, market and sell the property per the terms of the listing contract, disclose material facts, and verify that the buyer has received the seller’s property disclosure per state laws.

Answer 7

T

Question 8

T/F

Buyer representation contracts are similar to and contain many of the same elements as a listing (seller representation) contract. Buyer rep agreements can be exclusive right to buy or an exclusive agency contract.

Answer 8

T

Question 9

Is the Seller Obligated to pay the home warranty?
T/F

Answer 9

False
Home warranties may be offered by sellers or negotiated in an offer, and may be paid for by either party. Home warranties may cover the majority of a home, including all major systems and appliances, or simply cover one or more specific items (furnace, water heater, appliances, etc.).