When selling your home with a realtor, you must sign a listing agreement. If you want to get out of this agreement before the agreed end date, you must be aware that you cannot just end this agreement unilaterally. Can you get out of your listing contract with your realtor? The short answer to that question is yes, you can get out; however, it can be difficult.
Responsibilities of a realtor
The listing agreement is between the realtor (technically the brokerage) and the seller. This agreement dictates a number of responsibilities from the realtor to you, as the seller. These responsibilities are along the line of the following:
The realtor must:
- Meet his/her agency responsibilities to you, the seller, in a timely manner.
- Market the property until the property is sold under the agreement.
- Keep you informed of his/her marketing activities and any resulting transaction.
- Indicate to any buyer interested in the property that s/he is your agent.
- Tell buyers of all material latent defects affecting the property of which s/he is aware.
- Help you negotiate favourable terms and conditions with a buyer.
- Assist you in preparing and complying with a contract to sell the property.
- Present all offers and counter-offers to and from you, even when you have accepted a purchase contract.
- Inform you of all relevant facts about the transaction.
Strictly speaking, if the realtor is not living up to any of these responsibilities, you can get out of the contract because it can be considered a breach of contract. However, you will need to discuss this first with the realtor. Usually, these become discussions that most people would like to avoid.
Why do you want to get out of your contract?
A discussion with your realtor to get out is unavoidable
Some points on the list can cause a discrepancy in expectations between you and your realtor. For example, what is considered ‘timely’ to you? Or how often do you want to get information on any activity? If you don’t like your realtor for reasons such as bad performance or bad communication, it will be more difficult to get the listing contract terminated.
Should your personal situation change because, for example, you lost your job or you fell ill, this discussion will most likely go much different than telling your realtor that s/he is not performing well or lacks negotiation skills.
In case your concerns are about things like knowledge, skills and communication, you may want to involve the broker, as well. The broker can potentially mediate and resolve the issue you have. If the issue doesn’t get resolved and escalates, and you have proof that your agent is misleading, inadequately or misrepresenting you, you can turn to the RECA, the Real Estate Council of Alberta. This is the real estate governing body that protects the consumer.
Even when you discuss any issues with the realtor and the broker, it is not required of them to release you as the seller from the agreement if they see no breach of contract.
Get your termination in writing
Get your termination in writing or you can be on the hook for two commissions
Once you both agree to terminate the listing, it is important to get this in writing. There are special forms available that both parties sign. If you decide to just work with another realtor, and your home sells with this new realtor, while the agreement with your first realtor was still in place, you may be ‘on the hook’ for paying real estate fees to both parties. If you are in doubt about anything in regards to termination, you should seek legal council.
Reimbursement of any realtor’s expenses
Whatever the reason is for changing your mind about selling your home, you may be responsible for reimbursing your realtor for any reasonable expenses that were incurred while your property was for sale. The contract states something in the line of:
If you change your mind about selling the property, you must tell us in writing. You must reimburse us for our reasonable expenses up to the time you tell us. Reasonable expenses will include_________________.
On the dotted line, you may see items such as cost for photography, measurements, brochures, online advertising, MLS listing cost, an hourly fee etc. All these listing costs need to be written into this agreement at time of signing. You can’t be asked to pay for things that are not in the contract.
Discussion before signing a listing contract
Sometimes, sellers know beforehand that they may need to terminate the listing contract early. It is strongly advised to discuss this before signing, and you can ask the agent to write this into the contract. A common example is when a seller wants to either sell or rent the property, whichever comes first. So, while it is listed on the MLS, it will also be advertised for rent. If the home gets rented out before it sells, then the listing agreement gets terminated. Any cost for the sellers (or realtor) are clear when this situation occurs.
Conditional or unconditional termination of the listing contract
In any case, if in doubt, seek legal council
Conditional or unconditional termination are options to be agreed upon. Unconditional termination means there are no obligations under the listing contract left as of a specific date. If you agree upon a conditional termination, there are some obligations left under the listing contract. These obligations usually refer to any reimbursement on expenses made, or to the holdover period.
The holdover period means that if you sell your home to a buyer who was introduced during the time your home was listed, you still may owe commission to the realtor. Whatever these conditions are in the conditional termination, you have to make sure you understand them. And again, seek legal council if you are in doubt.
Withdrawal of the listing
If you want to pause your agreement because of a temporary issue, withdrawal is the best option. For example, if you get sick for a week or have an issue with a defect in your home, like flooding, your listing can be withdrawn for a short period of time.
You can withdraw your listing for certain issues such as sickness
Please note: The above is general information and not considered legal advice. We do our best to write informative articles about real estate in Calgary, Alberta. If you have any questions or concerns about our comments, please feel free to contact us or speak to your legal advisor.
Read more: Selling your home? The truth about ‘marketing’ your home.
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