LISTING FORMS: The Listing Agreement

Good advice: don’t sign anything without reading it through (or having your lawyer read it).  Better advice: don’t sign anything you don’t understand.

Let’s look at the current Exclusive Right-to-Sell or Lease Listing Agreement put out by the Oklahoma City Metropolitan Association of Realtors (OKCMAR).  This will be the first of a series of posts about the forms that we use here, so folks who are considering selling or buying a home can take their time going through the paperwork at their own pace.  Also, feel free to ask questions in the comments; even though our forms are pretty straightforward, they can be confusing and they are certainly LONG.  I’ll give you links to the full form in both visual and audio versions, and then I’ll go through a vastly condensed, five-thousand-foot overview.

Disclaimer: this is current as of Wednesday, Feb. 2, 2011, when I pulled it off the MLS.  (Coincidentally, Wednesday was the day after our little historic blizzard, when I was literally and figuratively stuck at home with a sick toddler.  Fun times.)  These forms change periodically, though, so it’s not guaranteed for ever and ever.  Also, I’m not an attorney, and I’m not giving you legal advice.  But you knew that already.  Didn’t you?

So let’s dive in!  Here is a pdf of a blank listing form; you can also listen to the full agreement by clicking here.  (Yes, that’s me!  It makes a change from I Am a Bunny, Duck for President! and That’s Not My Plane.)

The agreement’s first page can be summed up in one sentence:  The Seller hires the Broker to help them sell or lease their place, hopefully for around this price, and by the end of this time period.

The big chunk of text in the middle lists what all’s expected to stay with the house when you move.  A good rule of thumb is this: if it would take a tool of some sort to separate it from the house or land (shovel, screwdriver, crowbar …) then it stays.  So if that’s great-great-gran’ma Magdelena’s chandelier and you wouldn’t part with it for the world, either replace it before you put the place on the market or say explicitly, in both the listing agreement and the contract when you get one, that that fixture is not included in the sale.

Next, we talk about how, exactly, the broker’s working for the seller, and for how much.  For a complete breakdown of the difference between Single-Party versus Transaction Brokers, see my article about that here.

The Listing Agreement then talks about the fee agents charge for their services, when they earn it, and when they receive it.  Brokers get paid when their listings sell.  If the seller breaks their promise to use the broker and sells their house without the broker’s involvement during the listing period, the broker still gets paid.  Some sellers (no, not you; don’t look at me like that) wait until their listing has expired to sell to a buyer who saw the place while it was listed, so they can get the benefit of the broker’s work and advertising resources without paying any commission.  Don’t do that; stealing is wrong.  Think how you’d feel if you found out you’d been working your *#%@ off for free for the past three months.

Also, transaction fees.  Some offices — mine included — charge a fee in addition to the commission.  In our case, that fee goes to pay the salaries of in-office transaction coordinators.  The transaction coordinators look over all our files and make sure that closing won’t be delayed because we (or the other agents) have made a mistake on our paperwork.

Disclosures.  You HAVE to spill everything you know about the house.  If you live or lived there, you have to fill out a Property Condition Disclosure Statement.  If you bought it as rental property, you can fill out a Property Condition Disclaimer Statement instead.  Whether you lived there or not, if it was built before 1978, you have to fill out a Lead-Based Paint disclosure.  And if you find anything out about new or previously unknown problems with the place while it’s listed, you have to disclose that, too.  This is important because if you have a deal that goes south after the prospective buyers have had the home inspected, you have to fill out a new form disclosing all the newly discovered issues before you put it back on the market.

KeyBoxes or Lock Boxes.  We use two different kinds.  The first are boxes that Oklahoma City Realtors can open with a key we get from OKCMAR.  These MLS-issued boxes log everyone who accesses it and when. They look like this:

 

KeyBox & SupraKey; a Realtor's best friends. Well, except for miracle-working lenders and title companies that keep us up to speed.

The other kind we use open with a combination.  That way, any Realtor who wants to show one of our listings has to call us directly for the combination, and we can get their name & information first.  Both kinds provide a regulated means for Real Estate professionals to access homes that are for sale.  But (don’t ask me who thought this, but apparently someone did) these boxes are not security systems — they will not make your home safer, and there are risks involved in giving people you don’t know access to your property.

If you are really freaked out by the idea, you can either have your broker be there at all showings (which is a pain, because it means that each showing has to be coordinated around, at minimum, FOUR schedules, but it is doable) or move first and sell the home when it’s vacant.

Section 12 on Page 4 is a list of everything the Seller is letting the Broker do.  This is my job description, my half of the deal.  The next two sections are your half of the deal.

You promise that the property really is yours to sell — and that it’s not the collateral on any loan except your home mortgage –  you aren’t cheating on another agent in order to work with me, and you haven’t given anyone else first dibs on buying the property.  You let me know if the house is in a Historic Preservation Area, if you have any HOA fees, or any unpaid Special Assessments.  And you promise that you’re not lying about any of it.  I don’t like being lied to any more than you do.

You also promise:

a) not to be a jerk to work with

b) not to cheat on me

c) to COMMUNICATE with me about things that affect our relationship.

Because we’re in this together, you know?

And it’s got the standard “We all live in an uncertain world, and I’m not responsible for evil people or acts of God.  Even though you hire me to help you sell this place, you are still the owner.  You are responsible for and affected by what happens here like no one else; it’s part of the burden of homeownership.”

You decide whether you want a home warranty, and you see that defaulting on your agreement is not something you want to do.

And if we get into a fight, you agree to go to mediation.  Like that new show on USA with whatsername, the lady who looks like a walking toothpaste commercial, but without the wardrobe budget.

The last page is the legalese:

- if we fight in court, the winner takes all and the loser pays the lawyers

- there are lots of other documents we’ll sign; all together they make up our agreement

- you can’t give away your part in this deal without my consent (and vice versa)

- unless you die

- if Mr. & Mrs. Seller split up while the house is on the market, they still both have to sign the contract and closing documents.  If it’s messy and they can’t see each other without jumping for the others’ jugular veins, we can have separate closing times, but both names are on the listing, so they both have to sign.

- and there is no set, standard commission rate.  That would be a violation of Anti-Trust Law.  We don’t want to do that, because then Zombie Teddy Roosevelt would come and eat our brains.  That would be bad.

BRAAAAIIIINS!!

 

- and finally, we Realtors aren’t lawyers, and don’t give legal advice.

The last page has where you sign & put your contact info.  And there you have it; our gripping read of a Listing Agreement.

If you have any questions about this form, please feel free to ask!

Advertisement