Video: When is a Commission Due In a Real Estate Deal?
Monday Oct 19th, 2020
When is a Commission Due?
When a seller signs a listing contract to sell their property with a broker, the seller agrees to pay the broker a stated commission if the broker sells the property during the period of the listing contract.
The commission to the broker is due if the broker brings a qualified buyer who is ready, willing and able and who meets the terms set forth by the seller – provided that the buyer signs a sales contract, the seller accepts and the transaction closes.
A seller is generally under no obligation to accept an offer from a buyer, but that being said, the seller may owe the broker a commission if the seller refuses to accept an offer that meets the terms of the listing agreement, is for at least the listed price and is without any contingencies.
After the listing expires, the seller typically has no liability to pay a commission if the property is sold unless the property is sold to a buyer the broker has specifically identified in writing to the seller at the expiration of the listing.