Exclusive Agency – An agreement between a seller and a single (1) real estate agency. List of exclusive agencies: a contractual agreement under which the stockbroker acts as a legally recognized non-agency broker or agent of the seller and the seller (s) agrees to pay a commission to the stockbroker if the property is sold by the efforts of a real estate agent. If the property is sold exclusively by the efforts of the seller or sellers, the seller is not required to pay a commission to the stockbroker. (Modified 5/06) As part of an exclusive offer to sell, a seller may submit a list of potential buyers who have expressed an interest in the home. These buyers may be excluded from the listing agreement for a certain period of time and if one of them buys the house, the seller is not required to pay a commission. In such a situation, the stockbroker may refuse to assist the seller in the terms of sale and processing of documents – unless he can obtain a commission agreement. An open offer, sometimes called a pocket offer, is an informal agreement between the real estate seller and a real estate agent`s broker, with the seller agreeing to pay a specific commission to a broker who procures a buyer. If the seller finds the buyer, no commission is due. Another type, called a net list, offers a net base price that the seller accepts. If the agent sells the house above this net price, the realtor keeps the difference. Many states do not recognize network lists and others consider them illegal. The exclusive list of agencies is sometimes used as a compromise. It goes with the salesman by Owner (FSBO) who says that if they hire a real estate agent, it would be you.
The reason a broker would entertain such an offer is because it might be better than no list at all. There is a good chance that the seller will not be able to sell the house without help. An exclusivity agreement gives both parties a bit of what they want. The seller may be expecting to sell the house himself. Maybe the realtor fully expects an exclusive right to sell the list deal and wants to be paid for his efforts. It is not uncommon for a real estate agent to want an exclusive listing contract, a contract that pays only for him, and not a competing broker. If a competing broker brings the buyer, the exclusive contract agency will pay that broker. If you have the exclusive right to sell a deal, it means that your agent has the exclusive right to sell and earn a commission on the sale of your home. Whether or not you hire the buyer or your agent, your agent always earns a commission. While this sounds a little unfair, this is the most common agreement between a seller and an agent.
There is also a definite advantage for an agent who works hard to earn a commission. An exclusive agency list agreement is defined by an agent who has the exclusive right to represent the seller, but the agent only receives a commission if he brings the buyer. If the broker does not return a buyer, the seller is not required to pay a commission.