The broker designated in an exclusive agency listing is the one and only agent authorized to sell your house during the term of the listing. If any other licensed real estate broker or agent finds a buyer, your broker gets paid.
Because you aren't a licensed real estate agent, the listing contract excludes you. Under the terms of an exclusive agency listing, owners specifically reserve the right to sell their own house directly and ace the broker out of a commission. Your broker - who should be your strongest ally - is your competitor.
The adversarial relationship isn't good for you or your broker. Exclusive agency listings discourage brokers from spending time or money marketing property because the arrangement offers no assurance of a reward for their efforts.
Exclusive right to sell listings
An exclusive right to sell listing is also referred to as an exclusive authorization and right to sell or just a plain, old exclusive. The exclusive is the most widely used form of listing contract in the United States. Here are the reasons it's popular with sellers and brokers:
- Maximum incentive for brokers: Under this form of exclusive listing, the listing broker gets paid if anyone -- even the owner -- finds a ready, willing, and able buyer for the property during the life of the contract. Owner and broker are allies, not adversaries, with a mutually beneficial goal of getting the listed property sold as quickly as possible for as much money as possible.
- Maximum effort for seller: An exclusive right to sell listing gives your listing broker a strong monetary incentive to focus his or her time, energy, and advertising dollars on one priority -- a fast, top-dollar sale of your house. To that end, the listing broker should immediately cooperate with any and all other brokers who might have buyers for your property by offering to split the compensation 50/50 (or whatever split is customary in your area) with the broker who generates a ready, willing, and able buyer.
- Nothing is wrong with giving your listing broker a day or two head start on other brokers, if you approve. However, good brokers don't keep your listing quiet for long before advertising it and opening it up to cooperating brokers.
- Exclusive right to sell listing contracts vary widely in length, wording, and complexity from one state to another and from city to city within any given state. Regardless of the wording in your contract, here are a few fundamental facts to keep in mind about all exclusive listings. Key Facts of Exclusive Listings