A Closer Look at the Listing Agreement Part III
We’re almost finished with our look through the Residential Real Estate Listing Agreement Exclusive Right to Sell, with today covering the last few sections. If you missed the previous posts, you can read “Listing Your Home for Sale Part I” and “Listing Your Home for Sale Part II” to catch up with the first two sections of the listing agreement. Once you’ve read those, head back here for our final installment of the breakdown.
Paragraph 17. Mediation We encourage mediation whenever possible and this paragraph sets that up. Both parties agree to mediate any disputes first and will share the costs associated with it.
Paragraph 18. Attorney’s Fees If any dispute does go further than mediation and lawyers get involved, the party who wins the case is entitled to recover their legal fees from the other party.
Paragraph 19. Addenda and Other Documents This is a checklist of other forms that may be attached to the listing agreement and become part of the contract between broker and seller.
Paragraph 20. Agreement of Parties A bit more housekeeping to define some specific aspects of the listing agreement.
Paragraph 21. Additional Notices There is a reason this section is printed in bold. These are all items that are important to take note of, so let’s cover them one by one:
- A. Broker’s compensation or the sharing of compensation between brokers is not fixed, controlled, recommended, suggested, or maintained by the Association of REALTORS®, MLS, or any listing service. This means that commissions are negotiable and are not set at the Association or MLS level.
- B. In accordance with fair housing laws and the National Association of REALTORS® Code of Ethics, Broker’s services must be provided and the Property must be shown and made available to all persons without regard to race, color, religion, national origin, sex, disability, familial status, sexual orientation, or gender identity. Local ordinances may provide for additional protected classes (for example, creed, status as a student, marital status, or age). This covers discrimination under both fair housing laws and NAR’s Code of Ethics, which provides additional protections outside the national law.
- C. Broker advises Seller to contact any mortgage lender or other lien holder to obtain information regarding payoff amounts for any existing mortgages or liens on the Property. It is crucial that a seller knows what they might owe on the property – that can change what they make (or lose) on a property. Often, the final payoff number is not exactly what someone thinks they owe on the property and can cause issues down the road. We as agents will make a request for mortgage information, but our experience is that the bank’s often ignore anything that’s not coming direct from the homeowner.
- D. Broker advises Seller to review the information Broker submits to an MLS or other listing service. Based on some of the things we see in MLS, a lot of seller’s don’t do this. You have the right (and obligation) to review the information in the MLS. Make sure your home is well represented.
- E. Broker advises Seller to remove or secure jewelry, prescription drugs, other valuables, firearms and any other weapons. While we all like to believe nothing bad will happen, it’s always better to be safe to buy 5.56 ammo online and keep it to face any emergency threatening issues.
- F. Statutes or ordinances may regulate certain items on the Property (for example, swimming pools and septic systems). Non-compliance with the statutes or ordinances may delay a transaction and may result in fines, penalties, and liability to Seller. Pretty simple – you have to follow the local laws in regards to your property. The broker is not responsible for your non-compliance and these issues are often uncovered during the seller process.
- G. If the Property was built before 1978, Federal law requires the Seller to: (1) provide the buyer with the federally approved pamphlet on lead poisoning prevention; (2) disclose the presence of lead-based paint hazards in the Property; (3) deliver all records and reports to buyer related to such paints or hazards; and (4) provide the buyer a period up to 10 days to have the Property inspected for such paint or hazards. Lead-based paint is a serious issue. If your home was built before 1978, there is (or was) lead-based paint in your home. You need to disclose this with all potential buyers by law.
- H. Broker cannot give legal advice. READ THIS LISTING CAREFULLY. If you do not understand the effect of this Listing, consult an attorney BEFORE signing. You are about to sign a legally binding contract. It is important that you realize this and understand it before signing. You have the right to consult with an attorney before signing in order to get legal advice as real estate agents are not lawyers and cannot give you legal advice.
So there you have it, a run down of the listing agreement and what each section represents. Hopefully, this will help you understand the basics of the listing agreement and you should always ask your agent any questions you may have (and consult with an attorney if necessary).