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WARNING: This form and its contents should only be used with the advice of an attorney. CAARE has not investigated the legality of this form in any state and has not sought the approval of any regulatory departments for it’s use. A qualified real estate attorney should understand the benefits of this contract and be able to save you money and negotiate favorable terms for you.
TIP: If a Realtor attempts to “advise” you that this form is not legal, ask them for a cite to the licensing statute to which they refer. CAARE is located in Minnesota and we are aware of no licensing prohibitions or insurance prohibitions on using other listing contract forms. Also consider amending their form with our consumer friendly listing clauses. Negotiating a commission and the terms of employment is legal.
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Next time you sell your house, negotiate the terms and fees like a pro. When relocation firms negotiate a listing contract, they keep part of the commission and they use their own listing contract with much more favorable terms than the “standard” forms (they’re not standard at all – just one sided) with which Realtors will present you. Our form really should be reviewed by an attorney before you attempt to use it in your state. However, many of the ideas in this form should prove very useful to you when negotiating with your Realtor.
In order for the concepts in this form to really benefit you, use only highly qualified Realtors fromsmaller firms who are willing to negotiate their fee and who are willing to avoid dual agency. If any agent begins to tell you the “advantages” of dual agency, it is time to walk away as it is misleading and inaccurate to “sell” this terrible conflict of interest as a plus. Smaller firms are better than larger firms because not only do they have full access to the Multiple Listing Service, but they can avoid dual agency without sacrificing the number of buyers who can be shown your home. Remember, when dual agency (or designated agency) occurs, the broker can’t help you negotiate price or terms – the two most important reasons most people hire a Realtor.
Our Form vs. Theirs
• No JUNK fees. As if 6% ($18,000 on a $300,000 house) isn’t enough, most real estate brokers have inserted extra fees in the fine print of their form. These junk fees used to be called “Administrative Fees” but now have names like “broker commission” or “administrative commission.” Since Administrative Fees came under attack as being illegal junk fees for which no service was provided, brokers simply changed the name. Never pay this fee – it’s not on our form.
• Negotiate Both Parts of the Commission. Commissions are designed to be divided into two parts. Part goes to your broker and part goes to the buyer’s broker. What happens if the buyer is unrepresented by a broker? – your broker keeps the whole thing on “their” form. Make that fee payable to brokers OR BUYERS and you will attract a whole other market of buyers who want to do it themselves and save money. This will give you a marketing niche.
• No Liens. Even attorneys typically can’t put a lien on your house, so why would you let a Realtor. Many Realtor forms allow them to lien the proceeds from the sale of your house if you dispute their fee. Don’t ever allow this.
• No Closing, NO FEE! Most Realtor forms provide for payment of a commission even if the transaction falls through. Realtors justify their high fees because their fees are contingent – they only get paid if the deal closes. But then they hide language in their forms that entitle them to get paid even if the deal doesn’t close.
• No Dual Agency. Dual agency is legalized betrayal. The so called “disclosure forms” don’t begin to convey the risks. Don’t ever agree to dual agency or it’s evil brother, designated agency. Only use a small firm and you will reduce the risk of being exposed to this legal fiction.
• A Marketing Plan. Is your Realtor going to put your listing in Zillow, Trulia and other online sources – then have them put it in writing. Are they going to advertise it in newspapers? What else are they going to do… Our form provides for them to attach a marketing plan for your approval. Compare marketing plans from different Realtors and you decide which is the better value.
If you like our form, it’s free. We cannot be liable if you choose to use this untested form that has not been approved for use in any state. Please consider donating to our non-profit volunteer charity. Just click on our “Donate” button. Thanks.