1) Open Listing
2) Exclusive Agency Listing
3) Exclusive Right-to-Sell Listing
In New York, Exclusive right to sell means that the agency that list your house has the only right to sell it. In the contract you sign you agree to let them list in the MLS and take offers from other agencies. However they have the exclusive right to sell the listing. Even if you find a buyer you need to direct them through the agency. This is the common way to list. The agent should be able to explain this. If they cannot, you can interview another agent before you sign on. Wish you well.
There are three types of listing agreements in Colorado: Exclusive right-to-sell, Exclusive Brokerage Listing, and Open Listing. Your state probably doesn't have these same agreements. But they probably have something close. So I hope this is helpful.
Exclusive is the most common, frankly, because most agents are afraid that the seller will cut them out of a commission if they donâ€™t have this agreement. In our Colorado agreement it says that all communication with anyone interested in the property must be done through the listing agent and that no matter how the buyer is found or who found the buyer, the agent will get a commission. If you are new to selling a home, this is the agreement that I recommend because Iâ€™ve known times when the seller said something that turned the buyers off.
Exclusive Brokerage Listings are almost identical except for one important point. With this listing if the seller made first (and only) contact with the buyer or in other words if the buyer went directly to the seller to purchase the property and never contacted the selling agent, then the selling agent wouldnâ€™t get paid. You can see how this would scare most agents. I, however, am not most agent. I use this agreement quite frequently, primarily with For Sale By Owners (FSBOâ€™s) who may already have several possible buyers. I know that through my marketing efforts I can bring twenty times more QUALIFIED buyers through a sellerâ€™s property then they can and so an Exclusive Brokerage Listing doesnâ€™t scare me.
Open Listings are just that; they are open to anyone. Whoever brings to the seller the buyer that actually closes the transaction is the one who would be paid (or gets to keep) the commission. Iâ€™ve used this agreement a time or two, when I wasnâ€™t going to do any marketing and I already had a buyer or two â€œin my pocketâ€. Iâ€™ve never heard of anyone else using this agreement; and for good reason. What agent is going to spend dozens of hours and thousands of dollars to market a property just to have another agent go right around them and take a buyer directly to the seller, cutting out the â€œopen listing agentâ€? But the Colorado real estate commission has it available to use if any â€œspecialâ€ situations arise.
If you have any further questions or would like more information, please contact me. I hope to hear from any friends you have who are moving to or from Colorado.
Richard Davis, Broker