Listing your home in Nova Scotia but does the thought of all the paperwork you need to sign when listing your home overwhelm you? You’re not alone. One of the first documents you sign will be the Seller Brokerage Agreement. It is vital that you understand the documents you are signing and when you sit down with your realtor, ask questions! That’s what they are there for!
Today, we’re going to break down important parts of a Seller’s Designated Brokerage Agreement. There are several sections you should pay particular attention to. These are things that can affect your bottom line once you receive an offer.
A seller’s agreement or listing agreement defines the who, what, where, why, and when of selling a property here in Nova Scotia.
The first part shows who the agreement is between and where the property is located. It also includes the corresponding parcel number and the listing price of the property.
The Seller Brokerage Agreement
This section names the designated agent or listing agent of the brokerage who is to represent the seller during this transaction.
The Brokerage of your agent has certain obligations to the seller, and they are to maintain compliance with the Nova Scotia Real Estate Trading Act and the by-laws of the Nova Scotia Real Estate Commission.
The brokerage is to account for funds placed in their trust and the brokerage cannot use the seller’s confidential info for any gain other than what is in the agreement.
This part defines many obligations agents have to the seller, including the fiduciary obligation of loyalty, confidentiality, and full disclosure of all conflicts of interest.
The agents also use their best efforts to market the property and promote the interests of the seller.
Section 3, Part 2.
Your agent will present multiple options for marketing and other services. You should consider these services and how they will benefit you in your sale.
There is also space to add services that your agent agreed to provide, such as a 3D tour or specific marketing strategies.
This section states the dates of the beginning to and end date of the agreement.
There are two ways to list your property. Listing it on the MLS, the Multiple Listing Service, allows agents and the public to view the listing. If it’s listed as an Exclusive you will still sign the agreement, but the agent controls the distribution.
By signing the Seller Brokerage Agreement, you need to verify that you have the authority to sell. You’ll also need to provide all information on the property to the best of your knowledge. This section also defines what they are to do if the sellers receive inquiries directly, and states that they are to disclose any material latent defects.
This part discusses harmonized sales tax and how it applied to the purchase price. It is the seller’s responsibility to verify if it is correct.
This section explains what happens if you’re presented with multiple offers. You can decide if you want the buyers to be notified that they are in competition or not. Most often, a seller would want the buyers to know, as the buyers would then make their best offer.
Though by checking “Yes” to this option, the seller risks a buyer withdrawing their offer because they do not want to get into a bidding war.
As a seller, it is your responsibility to pay the brokerage commission for selling the property. This can be a percentage of the sale price or a flat rate. Because it is a service fee, here harmonized sales tax is applicable as well.
Section 9, Part 2.
The listing agent and the buyer’s agent split the commission. The other agent brings us buyers, so they receive compensation as well. Costs are one of the biggest concerns to selling your home. Be sure you understand all that is involved and where the money is going.
The section also reviews the holdover clause. This clause explains what happens if the brokerage shows the property to a buyer, but the buyer doesn’t make an offer until after the listing expired.
If the seller accepts the buyer’s offer within 180 days, the brokerage can request remuneration, since they were the ones that introduced the property to the buyer.
Section 9, Part 7.
This section informs you of the protections you have as a seller. Aside from what is in the listing agreement, a brokerage cannot benefit from the listing.
Confidentiality is important to realtors. When you sign your agreement, you allow us to share your information with others so we can get the property sold.
However, there is a caveat that permits realtors to reveal the sale price to be posted. That way, appraisers and other agents can determine the market value of similar properties in the future.
If the same brokerage represents the buyer and seller, they both must sign a transaction brokerage agreement. This type of agreement dictates that the brokerage will treat both parties equally.
Other scenarios would be the brokerage treating the buyer as a customer, or the buyer selecting an agent from another brokerage to represent them.
When you sign a contract with a realtor, you both are under certain obligations until the Seller Brokerage Agreement expires. If either party does not meet conditions, the agreement is no longer valid.
Reasons for termination may include if there is a successful sale, the decision to end the contract is mutual, or if the brokerage cannot contact you to schedule viewings.
Once this agreement has ended, the brokerage must cease all marketing, return any documents, and remove any signage advertising the listing.
The brokerage maintains your confidentiality and accounts for any funds held in the trust.
This section clarifies some miscellaneous provisions. These include that the Nova Scotia court governs the agreement and that no amendment is in effect unless signed by all parties.
There may be additional forms to this agreement, such as a listing addendum and property disclosure statement.
This area allows you and your agent to add any other provisions agreed to.
The last part is the signature section. The sellers listed on the property deed or whoever has signing authority, such as executor or power of attorney, to the seller must sign and date the listing agreement. Make sure you get a signed copy for your records.
Final Thoughts on The Seller Brokerage Agreement
Not fully understanding the contract or any other paperwork can be a costly mistake for sellers.
REALTOR®s deal with listing and purchase contracts daily, but not all REALTORS will take the time to make sure you know exactly what you are signing. Every question or concern you have is important and needs to be raised with your REALTOR® before you sign.
A REALTOR® is ethically bound to do their due diligence to make sure you understand what you are signing. The last thing you want to do is make a mistake, so if you have questions, let them know!
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