3 types of listing agreements you can sign with a realtor when selling real estate in Fargo ND
Posted by Becky Johnson, Manager // April 18, 2021 // Blog / Featured
Selling real estate in Fargo? When you hit the market and are looking for a buyer for your home, you’ll need to decide whether you want a real estate agent by your side throughout the process or sell on your own. The third option is to hire an agent for specific services, while handling the remaining home selling duties yourself.
You can limit the scope of an agent’s services by customizing the listing agreement that you and your agent will sign. It will give you more flexibility and help you save on agent commission.
You can customize the listing agreement in different ways, but below are the three most common types:
- Non-exclusive agreement or open listing for selling real estate in Fargo: It’s the most flexible listing agreement that gives you freedom to enlist the services of multiple real estate agents or brokers. You pay the commission to the broker who finds a buyer whose offer you accept.
- Exclusive agency agreement: Under this type of agreement, you enlist the service of a specific broker or agent and pay only when he or she finds a buyer.
- Exclusive right-to-sell agreement: Under this type of agreement, you are represented by a specific broker or agent and have to pay the commission irregardless of who finds the buyer. If you find the buyer on your own, you will still need to pay the commission. There are some exceptions to this rule. Most brokers will want to sign the Exclusive right-to-sell agreement for the obvious reasons.
Some other considerations
- Listing agreement duration: Nothing is set in stone when it comes to the duration of a listing agreement. It can be as short as one month or as long as one year. You can also ask your agent to agree to a clause that enables you to cancel the agreement whenever you want. Most agents won’t agree to this.
- Commission: The listing agreement also specifies the commission that you pay to your agent. The standard commission is six percent of the sales price. If the buyer is represented by an agent, this commission is evenly split between your agent and that of the buyer. Most agents will tell you that an agent’s commission is non-negotiable, but it’s far from the truth. You can negotiate the commission with your listing agent. If you are selling in a seller’s market (where inventory is tight and lots of buyers looking for homes), your agent will be able to sell your home effortlessly. In this case, most agents will be flexible and be willing to accept less than the standard commission.
Before signing a listing agreement, you should first decide whether you want a real estate agent to perform all the home selling duties. If this is the case, you may want to sign an exclusive right-to-sell agency listing agreement. Are you comfortable with handling some of the duties on your own? If so you can hire agents on a ‘la-carte’ basis, paying only for the services rendered by them. You should interview many realtors to find the right candidate for the job.