Tips for Creating a Rock-Solid Open Listing Agreement
Putting a property for sale comes with a lot of responsibilities. Finding prospective buyers and choosing the best one is not an easy task. The best chance of making the right sale is hiring professionals, such as real estate brokers, to do the grunt work for you.
Don’t know how to write a contract to protect your rights and ensure a good business relationship? Don’t worry— and get all the information you need!
In this article, you can find the ins and outs of an open listing agreement and the instructions for drafting one by yourself.
What Are Listing Agreements?
A listing agreement is a legal document between two parties—the seller of the property and a real estate broker—that permits the broker to represent the seller and their property in the property selling process.
After signing the contract, the broker acquires the rights to list, rent, and sell your property. In most states, listing agreements have to be in written form.
Open Listing Agreement in a Nutshell
An open listing agreement is a non-exclusive listing agreement. An open listing allows the seller to sell their property on their own as For Sale by Owner (FSBO) property or execute open listings with multiple real estate brokers.
Many sellers prefer this listing agreement over other types because there are almost no downsides. The benefits, on the other side, are quite compelling:
- The level of commitment is low
- More real estate brokers bring more selling opportunities
- The seller doesn’t have to pay commission to every broker, only the one that makes the sale
- The seller can make the sale on their own, avoiding paying the commission altogether
Open Listing Agreement vs. Other Types of Listing Agreements
Besides open listing agreements, real estate sellers can sign exclusive agency listing and exclusive right-to-sell listing agreements. You can find a brief overview of these listing agreement types in the following table:
|Type of a Listing Agreement||
How Does It Work?
|Exclusive Agency Agreement||
|Exclusive Right-To-Sell Agreement||
What Should an Open Listing Agreement Include?
Open listing agreements are legally binding documents. A seller can sign an open listing agreement with an unlimited number of real estate brokers. To become enforceable, an open listing agreement must follow precise regulations and include the terms and conditions the parties had agreed upon.
Not every open listing agreement is the same—the seller and broker can decide to add specific clauses.
How To Draw Up an Open Listing Agreement by Yourself
You don’t have to pay an attorney to draft an open listing agreement for you. You can find a contract template online or write one yourself. Even though it may seem complicated, writing an open listing agreement is simple. You can create an open listing agreement by following these steps:
- Write the signing date of the agreement
- Add full names of the seller and real estate broker
- Insert the listing terms of the agreement
- Provide a description of the property
- Insert the percentage and dollar amount of the commission
- Include terms regarding the cancellation of the agreement
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What Legal Documents Can DoNotPay Create?
The following table contains contracts and other legal documents that the world’s best virtual assistant can draw up for you:
|Real Estate||Business||Other Legal Documents|
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