By Ben Schott
With the uptick in real estate activity it is helpful to recap the two primary ways that a licensed sales agent is entitled to a commission from the sale of real estate.
Most agents have their clients execute a listing agreement, which primarily comes in two forms and entitles the agent to a commission in different contexts.
Generally, the exclusive right to sell agreement entitles an agent to a commission irrespective of who sells the property. For instance, an owner who executes an exclusive right to sell agreement and consummates a sale to a buyer without the aid of the agent is still obligated to pay the commission. Intuitively, an owner might think that once the contract expires without the agent procuring a buyer, the agent’s right to a commission is extinguished. However, most exclusive right to sell agreements contain “protection period” provisions that extend the agent’s right to a commission for a certain number of months after expiration of the agreement. These provisions trigger the agent’s right to a commission if a sale is consummated with a buyer whom the agent or seller communicated with (regarding the property) while the listing agreement was in effect.
The second type of agreement is the …read more
Source:: Legal Scoop