Some home buyers who are new to the real estate scene don't realize that when they enlist the aid of a Richmond Hill real estate agent to help them sell their home, that they're actually entering into a legally binding contract with the agent. If you're a little worried about the big long contract your agent presents you and whether you're effectively signing your life away, don't fret. This article should clear up the confusion so you know exactly what you're agreeing to.

You may be surprised to learn that there are actually three different types of real estate listings: an open listing, an exclusive agency listing, and an exclusive right to sell listing, any of which can apply to your Cabbagetown real estate depending on what you and your realtor want to do. An open listing is non exclusive. You can employ several realtors in competition and pay only the one that finds the buyer. You can also look for the buyer yourself. If you find one, you only have to pay the buyer's agent's commission.

The other two types of listings are exclusive. In an exclusive agency listing you're agreeing that the Oakville real estate agents you hire are the only agents who can sell your home. But you can still find the buyer yourself and not pay commission. In an exclusive right to sell, which almost all agents want you to sign, you agree that even if you sell your property yourself, you still have to pay commission to the agency. These agreements last for a specified period, usually from 3 months to a year. You can also program in your own exceptions, like giving a friend first shot at the property, or firing the realtor if he or she doesn't perform.

Probably the most important part of the agreement is the commission, because it outlines exactly how much of the money from the Toronto condo sales goes to the realtor. Contrary to popular belief, you don't have to agree to whatever figure your agent comes up with. You can negotiate. In Toronto it's generally around 5% - 2.5 to your agent, 2.5 to the buyer's agent. Usually the contract also contains a clause that penalizes you financially for breaking it and finding someone else to sell your homes in Markham instead. You may think you would never do that, but at least find out what the penalty is just in case.