Unit 6 Flashcards
Brokerage Agreements
Contracts for the professional services of the sponsoring broker. In IL can be oral or written but oral not recommended.
Establish rights and duties of the sponsoring broker as agent for the buyer or seller
Agreement must state illegal to refuse to sell to any person because of their membership to a protected class
Listing Agreement
Contract between the sponsoring broker and seller. Exclusive agreement must be in writing!
Buyer Agreement
Between sponsoring broker and buyer
Management Contract
Between sponsoring broker and owner of a rental company
Exclusive Right to Sell (Listing Agreement)
One broker appointed as seller’s sole agent. Majority of residential listing agreements in IL are Exclusive Right to Sell.
CANNOT have automatic extension clauses
Exclusive Agency
Broker acts as exclusive agent but seller retains right to sell without obligation to broker.
Brokers does best to sell but if seller finds their own buyer, broker does not get commission
Open Listing Agreement/Non exclusive
Seller can retain any number or brokers as agents. Whoever finds buyer gets compensated
Net Listing
Specifies seller receives a net amount from a sale and rest goes to the listing broker as commission
Legal in IL but not recommended due to potential for fraud
Option Listing
Gives broker right to purchase the property at some point at a specific price.
Multiple Listing Service
a marketing organization whose members make their listings available for showing and sale
No Subagency in IL
Licensees works for buyer unless consumer chooses not to be
Paying commission does not equal agency in IL
TRUE
Listings agreements can be terminated under following conditions
- agreement purpose fulfilled
- term expires
- property destroyed or use changed
- title is transferred
- mutual agreement
- broker or seller dies or becomes incapacitated
- either party breaches contract
After termination only duties are:
account for monies
keep information confidential
Broker Protection Clause/Safety Clause
Commission will be paid if within a specified period of time after expiration the owner sells to someone who saw property while listed (usually 60-90 days)
This discourages private agreements.
Cannot be enforced if property gets relisted with another brokerage
CMA
analyzes similar properties to help sellers determine listing price - look at solds, on the market and expired.
Provide price range
Appraisal
only based on sold properties. Give specific value
Market Value
most probable price a property would bring under normal conditions in the open market
Estimated Proceeds
Sales price minus all fee and expenses
Disclosures in IL
Agency Disclosures and Property Disclosures
Written Exclusion Listing Agreements must include:
Price commission and time of payment duration with termination date names signatures address or legal description duties non discrimination statement antitrust statement
Disclosure of Material Facts
Broker cannot withhold
Disclosure of Interest
broker must disclosure any interest they have in property
Disclosure of Special Compensation
Must disclosure in writing to all parties and licensee receives the payments through sponsoring broker
Earnest $ + purchaser default
must be in larger font on agreeement
Seller Disclosure of Property Condition
Given before offer made or buyer has 3 days to rescind contract. Lead paint disclosure if built before 1978. Radon disclosure
Listing Agreements
Broker must provide full signed copy to seller within 24 hours of execution
Exclusive Listing Agreement Minimum Services
Accept and present all offers, etc
Assist w/ developing and communications counters, etc
Answer questions
Buyer Agency Agreement
employment contract. Buyer is principal 3 types
Exclusive Buyer agreement/Exclusive Right to Represent
Buyer legally bound to pay whenever buyers purchase property described in the contract
Exclusive agency buyer agreement
broker gets payment only if they locate the property
Open Buyer
non-exclusive and only compensate broker who finds the property
Buyer Broker Duties include
needs assessment property selection viewing properties negotiations follow up
Prepare CMA to establish offer price. Must consider:
condition time on market supply and demand seller's motivation terms and contingencies
