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Open listing- carry no exclusive rights. An owner can given an open listing to any number of brokers at the same time, and the owner can still find a buyer and avoid commission.This gives the owner the greatest freedom of any form, but provides little incentive for brokers. Net listing- created when an owner states the price she wants for her property and then agrees to pay the broker anything above that price as the commission.Exclusive authority to purchaseAbove, we presumed the general rule that the real estate broker represents the seller. Historically, it has been the seller who has hired brokers to assist in marketing propertyconsumers are far more sophisticated and informed todayin these cases, the broker’s primary responsibility is to the purchaser rather than to the seller. In this circumstance, the purchaser can reveal confidential information to the broker and rely on the broker’s expertise and competence.Exclusive Authority to Purchase– an agreement where the broker works for the client, the buyer! Primary responsibility is to the purchaser. Principal is now the Buyer. Compensation issues oCommission splits ocustomary practices oSeparate agreementsMultiple listing serviceMLSorganizations enable a broker with a listing to make a blanket offering of subagency and/or compensation to other member brokers, thus broadening the market exposure.Multiple listing service- organization of member brokers agreeing to share listing information and share commissions.Greater sales exposureEasier for buyers to view what all is for sale from one location, easier for a broker because the seller’s property may be ore suitable in other officesElectronic marketing- most MLS systems allow up to 8 photos so a buyer can see pictures of the property before visiting. Buyer can also take a virtual tour through a neighborhood without leaving the office.Broker compensationListing brokersCommission earned per agreement between owner and broker. (Listing agreement) Earned when a ready, willing, and able buyeris found. This means they are ready to buy at the seller’s price and terms, and has the financial capability to do so.
Commission is due once broker has performed this duty, whether or not the sale is made—this is the benefit from the ready, willing, and able contract.The “no sale, no commission” approach is to the owner’s advantage.Buyer’s brokersBuyer’s brokers issues are a little more complicated. Most agreements provide that the buyer’s broker be compensated by the seller’s brokerLicense act requirementsIn Texas, real estate license act sets specific requirements that a person must comply withto maintain an action for a commission.