Real Estate Agent Listing Agreements

Create a high quality document online now!

A real estate agent listing agreement is a contract between a buyer or seller that defines the terms of an agency relationship between the parties. In general, the agent agrees to sell or assist an individual in purchasing real estate, most commonly residential property. The agent is paid based on the percentage (%) of the sales price known as their commission at the closing. If there are two (2) agents involved on each side, the total commission is to be split. Depending on the market, the listing agent may establish that they are to be paid more than the buyer’s agent and commonly noted in the Multiple Listing Service (MLS).

Listing Agreements By State

Listing Agreements By Type

Business Listing Agreement – For an entity seeking to sell their business with the assistance of an agent.

Buyer’s Agent Agreement – For an individual interested in purchasing a commercial or residential property.

Exclusive Agency Listing Agreement – The agency is not paid only if the property sells to a buyer not represented by an agent.

Exclusive (Right to Sell) Listing Agreement – Gives an agent the sole rights to sell a property on behalf of a seller for a specific time period (usually 6 to 12 months).

Net Listing Agreement – A net listing agreement is when the agent’s commission is the excess of funds above a fixed number. For example, the seller says they want $275,000, anything over that amount is the commission to the agent. Unfortunately, this practice can lead to unethical issues and is banned in some States (not offered on eForms).

Open Listing Agreement – Allows an agent to sell a property with the condition that if the seller, or other parties, sell the property that the agent is not entitled to a commission.

Table of Contents

Listing Agreement Addendums

Agency Disclosure Forms – Required in most States to inform the role of the agent and their duties as an agent.

Lead-Based Paint Disclosure – Required to be attached to any purchase agreement per federal law. Commonly completed at the time of authorizing the listing agreement.

Property Disclosure Statement – In most States, a seller of a property is required to disclose any material defects. This will be helpful to potential buyers when viewing the property online.

Agency Disclosure

In most States, the real estate agent will be required to have their client sign a waiver stating that they are aware of the agency relationship under a listing agreement. This is commonly authorized at the time of signing the listing agreement and attached with each party receiving an original copy.

Agency Disclosure Forms By State

State Requirement Laws
Alabama Consumer Information Booklet § 34-27-82(c)
Alaska Consumer Disclosure AS 08.88.396
Arizona Sample Form Not Required
Arkansas Agency Representation Disclosure § 17-42-108(a)(2) and § 8.3
California Real Estate Agency Disclosure § 2079.14 & § 2079.16
Colorado Brokerage Disclosure to Seller § 12-61-808(2)
Connecticut Agency Disclosure Notice § 20-325d
Delaware Consumer Information Statement § 2938
Florida No Standardized Form § 475.278
Georgia No Standardized Form § 520-1-.06(4)(b)
Hawaii No Standardized Form Not Required
Idaho Agency Disclosure Brochure § 54-2085
Illinois  Disclosure of Designated Agency 225 ILCS 454/15-35
Indiana No Standardized Form IC 25-34.1-10-10(a)(2) & IC 25-34.1-10-11(a)(2)
Iowa Agency Disclosure and Acknowledgment 193E—12.2(543B)(3)
Kansas Real Estate Brokerage Relationships Disclosure § 58-30,110
Kentucky Consumer Guide To Agency Relationships 201 KAR 11:121 (Section 5)
Louisiana Customer Information Form § 3703
Maine Brokerage Relationship Disclosure § 13279
Maryland Agency Disclosure Form § 17-530
Massachusetts Licensee-Consumer Relationship Disclosure 112 § 87AAA3/4
Michigan Real Estate Agency Relationships Disclosure § 339.2517
Minnesota Agency Disclosure Form § 82.67
Mississippi Working With a Real Estate Broker MREC 1601 4.1
Missouri Broker Disclosure Form § 339.770
Montana Relationships/Consents in Real Estate Transactions § 37-51-314
Nebraska Agency Disclosure Information for Buyers and Sellers § 76-2422
Nevada Duties Owed by a Nevada Real Estate Licensee § 645.252
New Hampshire Brokerage Relationship Disclosure Form § 331-A:25-b
New Jersey Consumer Information Statement § 11:5-6.9
New Mexico Agency Disclosure Form § 61-29-10.2
New York Disclosure Form for Buyer and Seller RPP § 443
North Carolina Working With Real Estate Agents 21 NCAC 58A .0104(c)
North Dakota Disclosure of Agency Relationships in Real Estate Transaction § 70-02-03-15.1.2
Ohio Agency Disclosure Statement § 4735.57
Oklahoma Disclosure of Brokerage Duties § 59-858-355.1
Oregon Agency Disclosure Pamphlet § 696.820
Pennsylvania Agency Disclosure Form § 35.284
Rhode Island Real Estate Relationship Disclosure § 5-20.6-8
South Carolina Disclosure of Real Estate Brokerage Relationships § 40-57-370
South Dakota Real Estate Relationship Disclosure § 36-21A-147
Tennessee No Standardized Form Not Required
Texas No Standardized Form Not Required
Utah No Standardized Form Not Required
Vermont Consumer Disclosure § 4.6
Virginia No Standardized Form Not Required
Washington Agency Disclosure Form § 18.86.030(g)
West Virginia Notice of Agency Relationship § 30-40-26(d)
Wisconsin Broker Disclosure to Clients § 452-135(2)(a)
Wyoming Real Estate Brokerage Disclosure § 33-28-306(a)

Real Estate Agent vs Realtor

A real estate agent is an individual licensed in their respective State to assist buyers, sellers, lessors, and lessees in exchange for a commission.

A Realtor is also a licensed real estate agent in addition to a member of their local Association of Realtors (Find Local Office). The Realtor designation gives access to benefits such as the MLS which provides a database of active listings, form software, and esignature.

Verify a Real Estate Agent

It’s important for real estate agents and their clients to verify that an agent is currently active in the State and allowed to facilitate real estate transactions. In order to verify, select the directory below:

Listing Agent vs Buyer’s Agent

A listing agent is hired by the seller to assist in the marketing and negotiating of their property.

A buyer’s agent, also known as a “selling agent“, is hired by a buyer to help find and negotiate a property.

Referrals

It is common in the real estate community for an agent to refer a client to another agent. Under this circumstance, the referring agent is commonly paid 25% of the total commission. When a client is recommended to another agent, a referral agreement is required to be signed.

How to List and Sell Property

A real estate agent is a salesperson. Therefore, the first party that is needed for them to ‘sell’ are their clients, the homeowners. An agent is able to represent potential buyers but the majority of prominent agents have what are known as ‘listings’ which are various properties that the agent has listed for sale.

Step 1 – Make a List of Potential Clients

The real estate agent should compose a list of expired listings, for sale by owners (FSBO’s), and any other leads in the area. Afterward, the agent should begin cold-calling and setting up meetings with the homeowners.

Step 2 – Begin Cold-Calling

Once a list has been made, it should be entered into Microsoft Excel or a Google Sheet in order to keep track of all communication that is made. It’s best to understand the needs of every homeowner and, in most cases, they are being contacted by multiple agents in the area seeking their business.

Therefore, it’s best to only attempt scheduling the meeting over the phone.

Step 3 – Compare Sales Data

After scheduling a meeting with the homeowner, the agent should begin to prepare and gather sales data in the area of the property. This can be done by using the agent’s local Multiple Listing Service, or simply ‘MLS’ (if the agent is a Realtor), or by using Zillow.com and local assessor’s data. Find out how the home compares with those that have recently sold. 

Step 4 – Write the Listing Agreement

This is a basic agreement that was most likely taught in real estate school prior to obtaining a real estate agent license. The agreement outlines payment and the rights of the real estate agent such as:

  • Commission Payment (%)

According to RealTrends, the average commission in 2017 was 5.12%. This does not mean the agent shouldn’t ask for more but is a good resource to know when walking into the meeting.

  • Exclusive Right-to-Sell

The agent should try to get an exclusive right-to-sell the property. This means that no matter how the property sells during the listing period the agent will be due a commission.

  • Time-Period

The agent should request to have the listing for 6 to 12 months. This will give the agent more than enough time to properly market the property.

  • Signage

Often times an owner will not want a sign in front of the property. Although, according to the National Association of Realtors, an average of 7% of buyers is found through the “For Sale” sign in the front yard. The importance of this also is determined by the traffic count on the street where the home is located.

Step 5 – Gather Required Disclosures

It’s important to get as much information out of the way in the meeting with the homeowners as possible, therefore, all required disclosures such as the Property Disclosure Statement, Agency Disclosure Statement, and any other State or local required document should be completed at this time.

Step 6 – Marketing the Property

After the listing agreement has been signed by the homeowners, it’s time to market the property by any means necessary. This should involve the following:

  • Place the Home for Sale Online

The agent should list the property on the Multiple Listing Service (MLS) which will place the home on Realtors.com, Zillow.com, Trulia.com [IS THERE A WEBSITE THAT ALLOWS AN AGENT TO DO THIS ALL AT ONCE?], and ______

  • Have an Open House

The property should be shown to the public via an open house. This will allow anyone who is looking to purchase a home to be able to preview the property without having to make an appointment. Use the Open House Sign-Up Sheet to follow-up and see if any of the potential buyers had an interest or if they need representation themselves.

  • Stage the Property

In some cases, the home is not properly furnished to best show how the property should look and feel. Therefore, the use of a designer may be a good investment by the homeowners or agent to paint rooms or rent furniture that matches the intended buyer.

Any and all attempts should be made to not only attract a buyer but get the maximum price for the home.

Step 7 – Receiving an Offer

 After prospective buyers are shown the home and its priced accordingly, the offers should begin to start. Some will be “low-ball” and others will be closer to the asking price of the seller. When an offer does come through, it will be in the form of a Purchase Agreement, and will usually have an offer span of 3 to 5 business days for the seller to respond.

The Seller has three (3) options:

  •  Acceptance – Accept the terms and conditions put forth by the buyer and close the transaction within the stated period.
  • Counter-Offer – Accept some or most of the terms provided by the buyer although changing some of the details, usually the price and non-refundable deposit.
  • Reject – This is in the case when the offer was so low there is no point of even coming back with a reasonable counter-offer. This is only applied when the offer was an insult to the value of the property.

If an offer is accepted, the deal is not valid until the buyer has been given notice that the offer has been accepted by the seller.

Step 8 – Buyer has the Property Inspected

After the home is under contract the buyer will begin their due diligence period. In most cases, the buyer will be seeking to have the property inspected to ensure all plumbing, electrical, and exterior portions of the residence are in sound condition. If anything that was not mentioned in the Property Disclosure Statement is found, depending on the terms of the agreement, the buyer may be able to cancel the Purchase Agreement without losing their deposit.

Step 9 – Attending the Closing

After the buyer has received financing, unless they were paying cash, a closing date will be scheduled. This will involve real estate attorneys on both sides as well as the real estate agents, title companies, and any other parties that should be in attendance. At the closing, all documents will be authorized, including the Deed, which will officially transfer the property into the buyer’s name. After the closing has concluded, the deed will be filed with the Registry of Deeds, and the transaction is complete.

For Sale By Owner (FSBO)

A for sale by owner, commonly known as an “FSBO“, is a property that is attempted to be sold by the owner of the property. FSBO’s are also a common target by real estate agents for cold-calling and marketing in an attempt to get the property as a listing. Therefore, if an owner of a property is seeking to sell it on their own, they should be prepared to handle the bevy of calls and emails by agents in their area.

Average Real Estate Commission

The average real estate commission in 2018 was 5.08% according to RealTrends. This does not mean the agent shouldn’t ask for more percentage or accept a lesser amount. There are many factors that determine the commission rate such as:

  • The Market – In a seller’s market the agent will commonly get less, in a buyer’s market the agent will commonly be paid more;
  • The Agent – If the agent is well-known in the area, he or she will demand more, if the agent is an amateur or new, he or she will expect less;
  • Services being Offered – Some agents offer additional services such as advertising the property online and in print, staging the property with the agent’s own furniture, lawn care, and any other services in order to help promote the sale.

Disclosed Dual Agency

When an agent is acting as a disclosed dual agent, or transaction broker, it means that they will be the only agent representing both parties. The agent does not have a fiduciary duty to either party even though the agent may have authorized an agreement to represent only one (1) of the parties.

Multiple Listing Service (MLS)

The multiple listing service, or “MLS“, is a service provided by Association of Realtors in your area that is a database of property listed for sale. Before the days of the internet, the MLS was the only updated source for real estate for sale. Access to your local MLS is only available to licensed Realtors.

Earnest Money

Earnest money is a payment made by the buyer when an offer is presented to the seller that expresses the seriousness of the buyer. Earnest money is usually non-refundable but commonly will have conditions that it is refundable in the chance there are issues with the building inspection, appraisal, or any other contingencies by the buyer.

Lockbox

A lockbox is a secured box commonly utilized by real estate agents to let other agents in a house that is for sale. The code or password to the lockbox is listed on the MLS and is able to be accessed by any Realtor. The listing agent should always be notified before entering the property to ensure the owners, tenants, or occupants are not on the premises.

Terminating a Listing Agreement

Terminating a listing agreement, in most cases, requires the consent of the real estate agent. Upon the client’s request to terminate, the agent’s first instinct is to believe the client is attempting to get out of paying a commission. Therefore, unless there is language allowing the client to cancel, both parties will be bound to each until the end of its term.

Otherwise, if the real estate agent requests to terminate the agreement, the client is inclined to agree as the agent is basically saying they do not wish to perform their services any longer.

How to Write

Download: Adobe PDF, Microsoft Word (.docx) or Open Document Text (.odt)

1 – Utilize The Form On This Page To Solidify A Listing Agreement

This page displays several ways you can access the template displayed on it. You may download this form by selecting either the links or buttons labeled “Adobe PDF,” “MS Word” and “ODT.” You can open and work on this paperwork live if preferred, however you are strongly encouraged to save this file to your machine. You will need to supply a few of the articles in this document with information so it will apply to the parties being discussed. Make sure that all information you furnish to this document is up-to-date, accurate, and represents the intentions of the signature parties.

2 – Identify The Seller, Broker, and Broker’s Agency

The article titled “I. The Parties” is the first item that will require your direct attention. First, list the calendar date of this agreement on the two blank spaces after the words “…Made On.”

Locate the bold label “Seller” then, on the empty line immediately following the date, produce the full name of each Seller of this property as well as his or her  mailing address (street address, city, and state) across the next three spaces. The next labeled area of this statement (“Agency”) shall focus on the Broker and the Agency who the Seller will designate with the right to market and sell the concerned property. The full name of the Broker and his or her Agency should be presented utilizing the first two spaces after the bold “Agency” label while the Broker/Agency mailing address may be documented with the three spaces following “…Mailing Address Of.” Furnish each of these items where appropriate.

3 – Deliver A Clear Property Description

Needless to say, a positive description of the Seller’s property that is documented accurately should be considered a necessity for this paperwork’s completion. To satisfy this requirement, chronicle the physical street address of the Seller’s property on the first blank line in “II. Real Property.” Keep in mind, the address you record should be composed of the identifying building or lot number, street name, unit number (if this applies), city, state, and zip code where the property can be (physically) visited. The next segment of this article is organized so you can quickly furnish supporting definitions regarding the concerned property. Turn your attention to the item labeled “A) Legal Description.” Here, furnish the “Tax Map/Lot” number using the first two spaces then report “Deed Book/Page” of the concerned property using the two spaces on the next line. Notice that these spaces have been preformatted to readily accept this information. Finally, if the county or state where the property is located has other means of keeping track of its properties or other physical descriptions should be presented to fully describe the Seller’s property then, record this on the blank line after “Other.” If the Seller plans on salvaging any fixtures currently on the property or intends to exclude fixtures from being involved in this transaction, then document them on the blank space after the word “Except” in item “B) Fixtures.” Conversely, if the Seller intends to include any personal property with the sale then report each such item on the blank space immediately following the phrase “…Shall Be Included As Part Of The Sale.”

4 – Discuss The Rights Assumed By The Agency

It will be necessary to verify how extensive the Agency’s right to sell the concerned property is. Three possible definitions can be used for this purpose and they are presented in “III. Rights To Sell” with a corresponding check box. You must select one of these definitions before this document is signed so it can be applied properly through this paperwork.

If the Seller will give the Agency the “Exclusive Right-To-Sell” the property thus, entitling the Agency to its commission regardless of whether the concerned property is sold by the Agency or not, then mark the first check box. This means that even if an outside party or the Seller finds a Buyer then, the Agency will be due its agreed upon commission upon closing. The second statement should be marked if the Seller intends to make this an “Exclusive Agency” deal – meaning that the Agency will only receive its commission if the Agency is the source for a Buyer. The Seller will retain the right to find a Buyer and if he or she accomplishes this, the Agency will not be owed any commission or payment. The “Open Listing” statement will allow the Seller the right to sell this property through another Agency or independently without owing a commission or a payment to the Agency named in this document. If, however, the Agency does find a Buyer, it will be entitled to its commission payment as defined by this agreement. Mark the third statement to solidify this statement as the Agency’s status with the Seller and this property.

5 – The Purchase Price Set For This Property Must Be Documented

The full price the Seller wishes the property sold for by the Agency must be registered in this paperwork so that it will apply to this agreement. Article “IV. Purchase Price” will contain the wording necessary to reliably achieve this purpose and will only require that you write out the full dollar amount the Seller expects for the property on the first blank space then enter the same number numerically in the parenthesis that follow.

6 – Report On Details The Seller And Agency Will Agree To

The fifth section, designated with the bold label “V. Period Of Agreement,” requires a record of when precisely this agreement will begin and when it will end. That is, when it is effective or active. During such time each signature party will be held responsible for adhering to the contents of this paperwork. Employ the first two blank spaces of this document to present the first calendar day and month then,  the third space to present the year when this agreement first becomes active. The next set of empty spaces require the last calendar date when the provisions of this agreement obligate the signature parties.  Notice this article also contains an item (“A. Listing Period Extensions”) that requires some input on your part as well. Here, use the blank space provided to record the number of days after the Listing Period’s expiration when the Agency will be owed its commission if the concerned property successfully transfers ownership from the Seller to a Buyer whom the Agent negotiated with. Now, we will need to discuss the commission mentioned earlier in a more direct manner. In “VI. Commission,” you must check one of two checkbox statements to document this properly. If the Agency will receive a “Percentage Commission” then mark the first checkbox. This statement requires you provide the sales price percentage the Agency will receive when successful in finding Buyer using the two spaces provided. If the Seller will provide a “Fixed Payment Commission” (a flat rate) then mark the second check box statement and supply the full dollar amount of the fixed payment to this statement in the spaces provided. The next segment of article “VI. Commission,” will contain two items that need your attention. Item “A.) Leasing” will address the possibility of the Agency finding a temporary Tenant who will rent the Seller’s property until the time of its sale. If this occurs, then the Agency will require some payment for its efforts. This will be in the form of a percentage of the total rent the Tenant pays. Document the percentage of the total rent the Agency will receive in such a scenario first by spelling it out then numerically. Now, fill in the type of deed the Seller will convey when selling this property on the blank space in item “B.) Deed Type.”

7 – List Provisions Applying To Agency Behavior

The seventh article will address the possibility that the Seller will require the Agency’s “Cooperation With Other Agents And Agencies.” In such a case, a predetermined commission of this sale that would be due to that Licensee should be clearly documented here. Locate the two blank spaces in this article then utilize them to report this commission rate.  In “VIII. Disclosed Dual Agency” we will consider the scenario where the Broker will act as the sole Licensee between the Seller and the Buyer. Naturally, the Broker will be required to disclose this information however, you must first indicate if the Seller will allow the Agency to behave this way. If so then, mark the check box labeled “Allow Disclosed Dual Agency.”  If not, then mark the second checkbox. Notice in the example below, the Seller will allow the Broker and Agency named in the first article to act as a Dual Agency. The next topic, labeled as “IX. Marketing The Property,” will require the direct attention of the Seller. If you are a Preparer then, relinquish this paperwork so that the Seller can satisfy the ninth article. This section will present a list of actions that require Seller act of approval. You, the Seller, must initial each statement that defines an action you will allow the Agency to engage in with the goal of finding a Buyer. Notice in the example below, that the Seller in this sale will authorize all the actions on this list except for two. By not initialing the third and sixth statement, the Seller will forbid the Agency from allowing third-party websites to create estimated market values or place a lockbox on the property.

8 – Supplement The Remaining Articles With Pertinent Information Where Appropriate

This paperwork will need to have the name of the state that governs its contents listed on the blank line in “XXVII. Governing Law.” The article that follows (“XXVIII. Severability”) should be reviewed by the Seller and the Broker before they sign their names. If there are any “Additional Terms And Conditions” the Seller and Agency require so this paperwork fully represents the agreement they wish to enter then, report each such provision on the blank lines provided in this article. In some cases, more room may be required to produce an accurate agreement. If so, then you may also use this space to refer to one or more documents that you wish included in this agreement and attached before this document is signed. All such attachments must be presented to both parties when it is time to review this paperwork for accuracy.

9 – The Seller And Broker Signatures At The End Of This Paperwork

The Seller and the Broker must read this document once it has been completed. Additionally, the Seller and Broker must initial the bottom of each page as verification that he or she fully comprehends and agrees to the contents of that page.

Now, the bottom of this page requires both the Seller and Broker Signature. Notice that two areas where the “Seller’s Signature,” printed name, and signature date must be placed so that if there are two Sellers both can provide these items legibly. If there is only one Seller, then only the first area should be signed. This act will begin when the Seller signs his or her name on the “Seller’s Signature” line and prints it on the “Print Name” line below it. Additionally, the Seller must date this act (of signing) by entering the calendar date at the time of signing on the empty line adjacent to the signature line.

Next, the Broker, as a representative of the Agency, must sign the “Broker’s Signature” line then print his or her name underneath the signature. The Broker must also report the full name of the Agency he or she is working with and representing by signature on the blank space labeled “Agency Name.” This must be printed. Finally, the Broker should personally document the signature date on the “Date” line.