What to include in a real estate listing agreement.
Learn more about this standard real estate contract so you can be ready for the sale of your home or property.
You might have heard about listing agreements, but what is a listing agreement exactly? In this guide, we’ll dive deeper into this standard real estate document, ensuring that you’re well-prepared and informed for your next big property move.
What is a listing agreement in real estate?
A listing agreement is a type of real estate contract in which a property owner gives a real estate agent or broker the authority to find a buyer for their property. If you decide to sell your home using a realtor, you will likely be asked to sign a listing agreement. Here is the basic framework of a listing agreement, so you can better understand this type of contract.
Real estate listing agreement types.
There are four basic types of listing agreements that make up most contracts. Which one you may agree to will depend on the agent or broker you decide to work with and what role you want them to have.
The four types of real estate listing agreements are:
- Exclusive right to sell
- Exclusive agency listing
- Open listing
- Net listing
Elements to include in a listing agreement.
While each listing agreement is a unique contract between the property owner and their real estate agent, most will include the same basic components. Here are the elements that nearly every real estate listing agreement will include:
- Names, addresses, and contact information for both the owner and the agent
- The time period in which the property will be listed for sale
- The listing price of the property
- The type of listing agreement being entered into
- The terms of commission, or how the agent will be paid once the property is sold
Is a real estate listing agreement always required?
The short answer is no— a real estate listing agreement isn’t always required. Nonetheless, there are many reasons why a real estate listing agreement is a key element during the selling process:
- Legal protection. A listing agreement provides legal protections to both the agent and the seller. This is because this document outlines the responsibilities of each of the parties, as well as the duration of the agreement, the amount to be paid, and other essential details. Without this agreement, it’s more likely that misunderstandings and disputes will arise.
- Exclusivity. Real estate listing agreements are usually exclusive, meaning that the seller agrees to work with a particular agent for the duration of the contract. This provides the assurance that the agent needs that their marketing efforts, as well as resources, won’t be spent in vain in case the property is sold.
- Professional representation. A real estate listing agreement primarily establishes a formal relationship between a property seller and a real estate agent. This ensures that the seller has professional representation to help market and sell the property, in addition to negotiating deals and handling other intricacies of the selling process.
Get a real estate listing agreement signed with ease.
Once the real estate listing agreement is signed, it's crucial to refer to a real estate listing checklist to ensure that all the necessary elements are included, helping both sellers and agents navigate the complex process seamlessly.
You’ll want to review your listing agreement carefully before signing to make sure the terms align with your goals for your property sale. Thankfully, getting your agreement signed digitally is much easier. You can use Acrobat to quickly and securely sign documents digitally so that you won’t miss a beat in your home-buying adventure.
