SU # 51__Listing Agreements

Question 1

What is an important thing to remember about listing agreements?

Answer 1

They must be in writing to be enforceable.

Question 2

Describe an open listing.

Answer 2

An open listing is a non-exclusive listing that allows a seller or buyer to engage a number of different brokers to sell or help purchase property. The broker who brings the buyer or finds the suitable property gets the commission. If the owner sells the property or the buyer finds his or her own property, no commission is owed to any broker.

Question 3

What is the major difference between an exclusive right to sell listing and an exclusive agency listing?

Answer 3

With exclusive right to sell, the broker has the exclusive right to market the property and receive a commission regardless of who procures the buyer. With exclusive agency, the owner retains the right to find a buyer and sell the property and owe the exclusive broker no commission.

Question 4

How does a net listing create a conflict of interest for a broker?

Answer 4

It violates the broker’s responsibility of putting the client’s interests above his or her own.

Question 5

What four components should be on every listing agreement?

Answer 5

An identification of the property

A promise of compensation to the broker

The specifics of that compensation

Written document with signatures of the seller or sellers

Question 6

The listing agreement is a contract between whom?

Answer 6

The agreement is a contract between the managing broker and the seller.

Question 7

What are the two most common changes to an original listing agreement?

Answer 7

Price changes and extensions to the listing period

Question 8

Broker Sara has lost her license for unprofessional conduct. What will happen to her listings?

Answer 8

The Department of Licensing can appoint a temporary broker to close any of Sara’s pending transactions. Otherwise, all Sara’s listings will terminate.

Question 9

What type of listing allows the distribution of the listings to all other brokers?

Shared Listing

Open Listing

Multiple Listing

Dual Listing

Answer 9

Multiple Listing

Question 10

Seller Jim wants to walk away with $175,000 in his pocket after the sale. Jim agrees to a net listing. The property sells for $212,000. How much money is Jim entitled to?

$175,000

212,000

$212,000 minus 5% commission.

175,000 minus a 5% commission.

Answer 10

$175,000

Question 11

When a seller signs a listing agreement, who are the actual contract parties?

Seller and Licensee

Seller and MLS Association

Broker and Licensee

Seller and Managing Broker

Answer 11

Seller and Managing Broker

Question 12

When must a seller receive a copy of the listing contract?

When an offer is accepted.

When the first offer is presented.

At the time of closing

At the time of signing.

Answer 12

At the time of signing.

Question 13

Which of these listing agreements is considered a unilateral contract?

Open

Exclusive Agency

Net

Exclusive Sale and Listing

Answer 13

Open

Question 14

Which of these statements is true?

Once a listing agreement is signed by all parties it cannot be changed.

The seller can change the listing agreement whenever he or she wants.

A listing agreement can be modified, but only if all parties agree in writing.

A listing agreement can change by the mutual verbal agreement of all parties.

Answer 14

A listing agreement can be modified, but only if all parties agree in writing.

Question 15

Which type of listing provides the most incentive for a broker to market a property?

Exclusive Agency

Open

Net

Exclusive Right to Sell

Answer 15

Exclusive Right to Sell

Question 16

Which of these sources would not be a way to determine who holds title to a property?

Seller’s Deed

Title Company

County Tax Office

MLS Data Bank

Answer 16

MLS Data Bank

Question 17

Net listings are _______________________

Illegal in Illinois

Encouraged

Viewed as unprofessional

Subject to excise taxes

Answer 17

Viewed as unprofessional

Question 18

Which type of listing is least attractive to a broker?

Exclusive right to sell

Open

Exclusive agency

MLS listing

Answer 18

Open

Question 19

To be valid, a listing agreement

a. must be in writing.
b. may be oral or written.
c. must be an express agreement.
d. must be enforceable.

Answer 19

b. may be oral or written.

Question 20

The type of listing that assures a broker of compensation for procuring a customer, regardless of the procuring party, is a(n)

a. exclusive right-to sell agreement.
b. exclusive agency agreement.
c. open listing.
d. net listing

Answer 20

a. exclusive right-to sell agreement.

Question 21

An owner agrees to pay a broker for procuring a tenant unless it is the owner who finds the tenant. This is an example of a(n)

a. exclusive right-to sell agreement.
b. exclusive agency agreement.
c. open listing.
d. net listing.

Answer 21

b. exclusive agency agreement.

Question 22

A landlord promises to compensate a broker for procuring a tenant, provided the broker is the procuring cause. This is an example of a(n)

a. exclusive right-to sell agreement.
b. exclusive agency agreement.
c. open listing.
d. net listing.

Answer 22

c. open listing.

Question 23

A property owner agrees to pay a broker a commission, provided the owner receives a minimum amount of proceeds from the sale at closing. This is an example of a(n)

a. exclusive right-to sell agreement.
b. exclusive agency agreement.
c. open listing.
d. net listing.

Answer 23

d. net listing.

Question 24

The most significant difference between an owner representation agreement and a buyer representation agreement is

a. the client.
b. the commission amount.
c. agency law applications.
d. contract law applications

Answer 24

a. the client.

Question 25

A multiple listing authorization gives a broker what authority?

a. To list the owner’s property in a multiple listing service
b. To sell several properties for the owner at once
c. To sell or lease the property
d. To delegate the listing responsibilities to other agents

Answer 25

a. To list the owner’s property in a multiple listing service

Question 26

A broker is hired to procure a customer for a client. In order to earn compensation, the agent must procure a customer who

a. has seen the property and reviewed all documents.
b. is ready, willing, and able to transact.
c. has completed an acceptable sale or lease contract.
d. will successfully complete the transaction at closing.

Answer 26

b. is ready, willing, and able to transact.

Question 27

One of the most important actions an owner’s agent is authorized to perform under an exclusive listing agreement is

a. showing the property.
b. assisting the customer in evaluating the relative merits of other properties.
c. authorizing price adjustments in a timely manner.
d. executing the sale or lease agreement.

Answer 27

a. showing the property.

Question 28

An agent’s performance of due diligence concerning a listing can best be described as

a. initiating the marketing plan on or before a deadline.
b. expending an amount of effort that is commensurate with the nature and size of the transaction.
c. ascertaining the facts about the client and the property at the onset of the listing period.
d. helping customers satisfy their needs to the extent they are entitled.

Answer 28

c. ascertaining the facts about the client and the property at the onset of the listing period.

Question 29

The amount of a real estate broker’s commission is

a. established among competing brokers.
b. established through negotiation with clients.
c. established by the Board of Realtors.
d. established by state real estate license law

Answer 29

b. established through negotiation with clients.

Question 30

A client suddenly decides to revoke an exclusive right-to-sell listing midway through the listing term. The reason stated: the client did not like the agent. In this case,

a. the client is criminally liable for discrimination on the basis of the cause for cancellation.
b. the client may be liable for a commission and marketing expenses.
c. the agent can sue the client for specific performance, even if no customer had been located.
d. the agent has no recourse but to accept the revocation.

Answer 30

b. the client may be liable for a commission and marketing expenses.

Question 31

A “protection period” clause in an exclusive listing provides that

a. the owner is protected from all liabilities arising from the agent’s actions performed within the agent’s scope of duties.
b. the agent has a claim to a commission if the owner sells or leases to a party within a certain time following the listing’s expiration.
c. agents are entitled to extend a listing agreement’s term if a transaction is imminent.
d. an owner is not liable for a commission if a prospective customer delays in completing an acceptable offer.

Answer 31

b. the agent has a claim to a commission if the owner sells or leases to a party within a certain time following the listing’s expiration.