I am currently in a contract with an agent who is not only disappointing me with her lack of enthusiasm and professionalism, but seems to be giving up on my house as well. She keeps saying she doesn’t know what else to do, short of lowering the price of the house dramatically, which I’m not willing to do — we’ve already come down by about $100,000 — not sure we can go much lower than that! So if we’re mutually unhappy/dissatisfied with the arrangement, what are my options? Do you think it will be easy to “legally” get out of the contract? I have a few more months left, but I am hoping to get out ASAP. I really feel that listing with her is a waste of time. What do you think I can do, and is this a common situation?
Very common situation right now, I’m afraid.
I’m going to assume you signed an Exclusive Representation contract, a normal listing agreement. Unless there is explicit language in that contract providing for unilateral cancellation, it can only be cancelled by mutual consent.
As a matter of course, all of our employment contracts include this language:
This agreement will be terminated without recourse upon written notice by either party.
If you’re done with me, I’m done with you. Another way of doing something similar is a buy-out clause: You can unilaterally cancel upon payment of a contract buy-out fee. That may seem unfair, given that your house hasn’t sold, but your agent went out of pocket on the listing expecting to have six months (or whatever) to recoup that investment. For my own part, I don’t want to take your listing unless I’m convinced I can hang a “SOLD!” sign within a month.
But there may be a way out of this labyrinth. My very first listing cancelled on me. I went to my broker at that time and said, “The seller wants to cancel, but it’s your listing contract, not mine. What do you want me to do?”
And the answer he gave me was beyond wisdom, in essence a one-sentence encyclopedia on how to run a real estate brokerage sanely and equitably. Here is what he said:
“We can’t sell it for her if she won’t let us.”
In other words, if the seller was so upset that she would not entertain any offer, there would be no point in holding her to the strict terms of the contract. She wasn’t actually that mad, but, like you, she had lost all confidence, so there was no reason to believe we could do her any good — especially not against her will.
So that’s my answer to you: Go to your agent’s broker and graciously ask to be let out of the contract. If they want a buy-out fee, pay it if you think it’s reasonable. If they won’t let you out, or if they want to hijack you with an exorbitant buy-out fee, patiently explain that you are going to devote the rest of your life to describing your experience with that brokerage to everyone you meet.
With luck, reason will prevail. If not, you’re stuck. Sweat out the contract and keep your eye out for listing agents who can get the job done. I’m sorry that you’re in this situation. My belief is that the kind of termination language I quote above should be boilerplate in every real estate employment contract. Make sure you include in every exclusive employment agreement you sign from now on…
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Kris Berg says:
I use a similar exit clause in all of my listing contracts. I’ve never sensed a value in forcing one to be a party to a contract against their wishes. I have only heard of one case in my career where an agent refused to let a seller out of their listing contract, which struck me as just about the dumbest business decision I had ever witnessed. Your response, Greg, was right on the money.
December 6, 2006 — 11:56 am
Jeff Royce says:
Greg,
I tell my selling clients at the listing appointment that I will let them out of the contract if they loose confidence in me. I like the contract language you suggested. There’s no reason I shouldn’t put my verbal assurances in writing.
December 6, 2006 — 12:26 pm
Jim Kimmons says:
Greg:
I’ve always allowed a Seller out with a clause in the listing agreement, but I like the bilateral statement you use. Thanks
Jim
December 6, 2006 — 12:52 pm
Russell Shaw says:
We also give all of our sellers (and ourselves) the right to cancel just by calling and saying, “I want to cancel”. As any listing CAN be canceled if the seller wants to get nasty enough about it, it seems odd to have a policy of only letting really nasty people cancel.
December 6, 2006 — 11:01 pm
sam pignato says:
I am a seller who had two transaction history with my colewell banker listing agent. One was unsuccessfull at selling my home and the second I had him rep. me on a purchase. When I considered using him a third time to sell that home, after 2 days, i called and cancelled listing that I sgned, making it clear I was going to shop around and not list now. I listed with some one else 45 days later, house sold in 5 days, and at prior to close of escrow, that agent I verbally cancelled with is demanding commission with mediation demand. Im shocked at this attempt. This is a 3.6 million dollar sale. This agent waited till it closed. He accepted the verball cancellation as he done before with me. My attorney used extortion as description. Shocking!!
February 21, 2008 — 6:02 pm
Jason Lopez says:
I know this is an old post but it cauught my eye. Your comment: “We can’t sell it for her if she won’t let us.”
In other words, if the seller was so upset that she would not entertain any offer, there would be no point in holding her to the strict terms of the contract.
Not necessarily true. The exclusive right to sell agreement states if the broker procures an offer on the exact terms of the lisitng, then the seller owes the full commisison. It also states that if the selelr makes the property unmarketable for any reason, they owe the full commission. Now in the real world this rarely happens…but it has happened to me twice. And I got paid on both contracts. The flip side is certainly to consider any negative publicity that may come of it. But I worked hard on behalf of unreasonable sellers and earned those comissions.
February 21, 2008 — 6:52 pm
Jason Lopez says:
I know this is an old post but it cauught my eye. Your comment: “We can’t sell it for her if she won’t let us.”
In other words, if the seller was so upset that she would not entertain any offer, there would be no point in holding her to the strict terms of the contract.
Not necessarily true. The exclusive right to sell agreement states if the broker procures an offer on the exact terms of the lisitng, then the seller owes the full commisison. It also states that if the seller makes the property unmarketable for any reason, they owe the full commission. Now in the real world this rarely happens…but it has happened to me twice. And I got paid on both contracts. The flip side is certainly to consider any negative publicity that may come of it. But I worked hard on behalf of unreasonable sellers and earned those comissions.
February 21, 2008 — 6:53 pm
CW says:
I just saw this post myself and it explains perfectly what I am going through. My agent who I trust and will not use any other agent left her broker because of his incompetence and to
“get back at her” hes not letting me out of my contract with his realty company even though I have asked to be let out repeatedly so I am sending another letter today and telling everyone how horrible Expert realty is and that the owner broker holds listings hostage. I cannot believe somone would think throwing a temper tantrum would be better than conducting themselves in a professional manner. I think he thought because I am an older woman that he could bully me. He’s about to find out how wrong he is.
April 14, 2008 — 8:44 am
Greg Swann says:
This is a case where paying a real estate attorney $200 to write a letter might make a difference. If you’re in a smaller community, placing a “What options do I have?” call to the local Board of Realtors might also open up some back-channel communications. But: The broker is within his legal rights, so cornering the rat may not be the best strategy. Appealing to his better angels or offering to buy him out of the contract might work better. I wish you good fortune…
April 14, 2008 — 8:55 am
CW says:
Thanks Greg. I took your advice and called the Board of Realtors here in St.Louis and was informed this realtor is on the board of ethics??!! Needless to say the person I spoke with was appalled at how he is conducting himself. I have contacted an attorney. Thanks so much.
April 15, 2008 — 11:33 am
Greg Swann says:
Good on ya, CW. Here’s to a happy ending!
April 15, 2008 — 6:32 pm