You have decided to sell your home, Congratulations! Whatever your reasoning, you will be venturing into the next chapter.  With that, you have decided to hire a Realtor to represent you on the sale, which is highly advised.  Realtors bring a wealth of knowledge and expertise into the home sale process including getting your home ready to list, managing all the home showings, negotiating contracts, and ensuring that all your interests are met. 

When a Realtor is hired, they will have a listing agreement for you to read, understand and sign which initiates your relationship.  The listing agreement holds the terms to listing your home on the market for sale.  Each state, through its Board of Realtors, has a state-approved listing agreement that is standard for every home listing.

As a member of the National Board of Realtors, each contract shall include the following items:

• A starting date and termination date 
• The list price that the home will be offered for sale
• The compensation amount to the broker along with the terms and conditions of the fees
• The authorization to co-operate with other brokers when a willing and able buyer is procured

The contract also includes other information regarding the advertising of the property which includes but is not limited to posting a for sale sign in the yard, putting a lockbox on the property, and any fixtures and personal property included (or not included) in the sale.

There are several types of contracts but in general, there are three main types of contracts:

1. Exclusive Right to Sell: Realtors who are members of the National Association of Realtors will list the property in the Multiple Listing Service (MLS).  The seller agrees to compensate the brokerage if the property is sold prior to the listing agreement expiration, regardless if the buyer came from the brokerage or not.  The seller cannot list the property with another brokerage until the expiration of the contract.  
2. Exclusive Agency: The seller can only list the property with one brokerage until the listing agreement expires.  The seller agrees to compensate the brokerage only if a buyer comes from the same brokerage.
3. Open Agency: The seller can enter into an agreement with several brokerages to sell the property and compensate the brokerage who provides the buyer for the property.  

Most (99.9%) listing agreements are Exclusive Right to Sell.  It provides maximum exposure by listing in the MLS and full Realtor representation.

The terms of listing agreements are negotiable between the listing agent and the seller.  Listings are typically 6 months in length but can be shorter or longer.  Also, the list price included is not necessarily the price the home will sell for.  The home could sell for higher or lower than the list price depending on the market conditions of the area.  Broker compensation is also negotiable but typically in the 5% to 6% range but not a set standard fee by market.

Be sure to interview your new Realtor and ensure that that person is the right person to get your home sold!