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What are listing agreements? – When talking about listing real estate for sale, here in Illinois we have written agreements between the property owners and the brokerage they hire to help them sell. These are called listing agreements and can be 1 year long, not a day more. They can also be shorter. The agreements outline what the seller and brokerage agree to do, for how long and the fee for a successful sale and when that gets paid.
Real estate listing agreements are between Brokerage and real estate principcals (owners). Not between agent and owners.
Typically listing agreements are 6 months or longer because here in Barrington Illinois our market times on average are still longer than that. The time of your listing agreement is part of a contract and just like the compensation they are negotiable.
Should You Agree To Long Listing Agreements?
There are always reasons why somewhere along the way you decide you want or need to cancel a listing agreement. For example:
- You decide not to sell at this time.
- Your move is being postponed – perhaps a relocation.
- You are not happy with the services being given.
The question is can you cancel? Typically most agreements do not have a cancellation clause written in. If you signed for a year you are in for a year. A much better option for sellers is to ask for a cancellation agreement. If you decide not to move most Brokerages will remove your home from the MLS and any other marketing they are doing, but your agreement may still be in force. So thinking you can call another broker to list with them could get you and the new broker in big trouble. (You might owe two sets of compensation!)
Get Your Cancellation In Writing
If your Brokerage agrees to cancel your listing agreement get it in writing. It’s the only sure fire way of knowing your agreement is contractually terminated. Remember too that your agreement is with the brokerage, not the REALTOR. The only person who can truly cancel listing agreements are the Managing Brokers of the office. Therefore that’s the signature you should seek on a termination agreement.
Why Your Agent Should Not Cancel Your Agreement.
If you have a change of heart about moving that’s one thing, but if you find out a friend will sell your home for lower compensation then that’s another. While your property is under agreement no REALTOR should talk to you about your listing. You can approach them, but they MUST NOT approach you. Regardless it’s not a good enough reason to end an agreement with one agent just to use another. Your intention at the outset was to give your agent a fair chance of selling your home and they have spent money, time and effort to market your home.
If you have a complaint about your agent, your best course of action is to raise the issue with them and see if it can be resolved. If you are still not happy then this may be the time to exercise your cancellation agreement. I would expect you to have to give 30 days notice to do so.
So there you have it. The long and short of real estate listing agreements here in the Barrington and northwest suburban Chicago areas. If you have any questions, please do not hesitate to ask. My final thought.
All markets are different, listing agreements should somewhat reflect the market conditions in your area and the confidence of your broker in selling your property.