Things Sellers Should Know when Dealing with a Real Estate Agent
* Find out what your relationship with the firm will be. Some firms practice designated agency. This means only certain agents represent you (with your consent) and other agents in the firm do not and may in fact represent an opposing party. Other agencies and all the agents affiliated with that agency will represent you.
* Make sure the real estate agent is licensed and in good standing with the Board. (Check that both the broker’s and salesperson’s licenses have not been subject to disciplinary action, such as a suspension or revocation.) Visit www.mass.gov/dpl/ or call (617) 727-2373.
* Sellers typically use the services of a real estate broker to sell their residential or commercial property. This is usually described as giving that broker a listing. The terms of the listing agreement are negotiable.
Often brokers present sellers with a standard listing agreement (an agreement which contains “standard language”). These agreements are commonly used in the practice. (They are not, however, developed by the Real Estate Board or by state government.) You may negotiate different terms that are acceptable to you and the broker.
Typical negotiable items include:
How long you will give a broker to sell your real property, the type of advertising which will be done, and the commission you will pay to the broker.
Unless your needs demand otherwise, your listing agreement should seek to have your property advertised in as many advertising mediums as possible, thereby giving it greater exposure to more potential buyers. (For example, the Listing Service of private professional associations, local newspapers, newspapers with statewide circulation, or the internet.)
* Determine whether you want the real estate agent to be the only person to represent you. This is a typical arrangement, but some sellers may wish to enter into a non-exclusive listing agreement with an agent, based on their particular needs. In such situations, the agent does not exclusively have the right to sell your real property. That agent will attempt to sell it, but you may also employ other agents and your own efforts in selling the real property. Naturally, non-exclusive listing agreements may affect the ultimate terms of the agreement, particularly the commission. (Remember, the broker bears the cost of advertising the property, which can be substantial. With a non-exclusive listing agreement, the broker may want a larger commission for a sale made by the broker since he or she undertakes these costs without the exclusive right to sell.)
* Check if a broker has errors and omissions insurance for his or her brokering practice. (State licensing law requires real estate brokers to have a five thousand dollar surety bond, but many brokers carry additional errors and omissions insurance.) This may be helpful should there be a problem which leads to litigation against a broker.
* Check to be sure your broker will accept offers made from other brokers including brokers who represent the buyer exclusively and brokers who may not be affiliated with a professional association. Brokers are required to present all offers that are made to them to you, the seller, all offers received on your behalf.
* Clearly understand what your interests are so that when you enter into a listing agreement with a broker you are comfortable with the terms. You also may want to have an attorney review such an agreement before you sign it.