Unit 9 - Representing Buyers & Sellers

Question 1

The Seller Brokerage Agreement (Form 200) is the seller granting authority to the brokerage to act on their behalf to offer a property for sale.

What are the 3 major listing types that could fall under this agreement?

Answer 1

1. Open Listing
   This is when the seller can give the listing to numerous brokerage and who ever finds a buyer gets the commission. Buyer can even be found privately in which case no brokerage gets it.
2. Exclusive Listing
   Giving a brokerage exclusive right to list the property
3. MLS Listing
   This is an EXCLUSIVE listing that extends authority to co-operating brokerages within the MLS system

Question 2

What are the 3 main functions the Seller Brokerage Agreement (Form 200) does?

Answer 2

1. Establishes relationship between seller and brokerage while defining limitations to agent’s authority
2. Provides detailed info about the property so that the selling agent can answer inquiries
3. Establishes the bases for offer drafting and negotiations and mortgage application (where applicable)

Question 3

The Seller Brokerage Agreement (form 200) generally includes two or more addenda. Describe all 4 possible addenda:

Answer 3

1. Listing Addendum (f230 - 234)
   Details property particulars for different property types.
   Form 230 is residential, 231 is commercial, 232 is multi-family, 233 is farm, and 234 is vacant land.
2. The Equipment Schedule Form (f210)
3. Property Disclosure Statement (f211)
4. Brokerage Addendum

Question 4

Ok, this section is all about forms.

Answer 4

So study the dang forms. Try filling them out. Print them and just pour over them.

Question 5

So we all know that if a brokerage under a standard agreement has both a seller and buyer client (but perhaps two different agents) they should have all parties sign a Transaction agreement to shift the relationship to being impartial and transactional. And of course, if it’s a designated agency and a single agent has both a buyer and a seller, then they’ll need to sign The Transaction Brokerage Agreement for Designated Agency (Form 412).

What about if the buyer comes to say an open house and isn’t already a client? What then?

Answer 5

Then they are not a client and an agency relationship is not already established. SO, they just need to sign a Buyer Customer Acknowledgement (Form 110).

So now the buyer is just treated like a customer and the seller is not done a disservice of having to enter a more transactional relationship when they had originally signed up for full-service.

Question 6

Indemnification is what?

Answer 6

Indemnification is the seller obligation flowing from agency duties owed by a principal to an agent

Question 7

How long is the remuneration holdover period?

Answer 7

The holdover period is 180 days.

So if the property is sold to a person introduced to the property by the listing brokerage within the 180 day period, then commission is due.

Question 8

Is commission subject to HST?

Answer 8

Yes, Commission is subject to HST and the seller pays it along with the commission amount that is due and payable to brokerage.

Question 9

When do you not need to disclose in writing to the buyer what the remuneration being offered by the seller is before an offer is drafted?

Answer 9

So you always need to disclose the remuneration being offered by the seller’s brokerage before an offer is drafted UNLESS it is an exact match to what was specified in buyer’s agreement.

So this is why it’s quite common for good agents to only sign this agreement once an offer is being drafted, as it lets them match this price and keep the idea of remuneration out of the buyer’s mind.

If they differ and the buyer will be on the hook after the deal to further compensate their brokerage, they of course need to disclose this is in writing and sign off in an amendment (form 220). Otherwise, an email will suffice.

Question 10

In Nova Scotia, salespersons are finding interesting careers in rentals and lease negotiations. Is this applicable to residential rentals?

Answer 10

Nope. Residential rentals and leases lie outside the scope of the Real Estate Trading Act and therefore are not a real estate trade.

Only Commerical leases are considered trades under the Real Estate Trading Act

Question 11

When would there often be the case for a Seller Customer Acknowledgement & Fee Agreement (Form 112)

Answer 11

So of course, this is pretty straightforward for the buyer version (say an open house or just browsing MLS without agent), but for sellers, this is often when the a buyer agent would approach a homeowner seeking for them to sell it to their client (for sale by owner).

So the seller would stay as a customer throughout the deal if they agreed to this, and could negotiation remuneration of some type of fee to the broker (if at all).

Question 12

What is the Mere Posting Service Agreement (form 203)?

Answer 12

This is just like it sounds.

It’s when a brokerage agrees to list a property on an MLS in exchange for a fee but the seller is responsible for everything else.

NO AGENCY RELATIONSHIP IS CREATED

Question 13

FINTRAC requires what identification verification with every real estate transaction?

Answer 13

They required ID must be kept for 5 years for every transaction in which a brokerage is involved.

Question 14

What is the most common term addressed in a counter offer?

Answer 14

Price is by far the most common reason for counter offers

Question 15

How do you conduct the presentation of the buyer’s agreement?

Answer 15

Watch the video I saved to Dropbox! :)

Question 16

If a seller refuses to enter into a transaction brokerage situation, does the listing brokerage have to immediately terminate the Seller Brokerage Agreement (Form 200)?

Answer 16

Nope, there are other pathways to move forward.