When a Seller lists a property “for sale” with a Realtor™ (or any real estate agent) using an “Exclusive Right to Sell” listing form, the Seller becomes obligated to pay a commission to the broker, no matter what. This means that, in the event a Friend of the Seller agrees to purchase the property, the Seller is still obligated by the agreement to pay a full commission – even when the buyer lives next door and/or the estate agent played no part in obtaining the buyer or negotiating the terms.
The Seller can avoid paying a commission to their Realtor®, in the event YOU purchase the property only, by using the “name(s) reserved” technique, described here.
In the “other conditions” or “terms” section of the listing form (or even along the edge of the form for that matter), the Seller can simply write down these words*: One name reserved: [put the name here]. (See the sample below.)
In the event the Seller wants to “reserve” (not be required to pay a commission on) more than one name, these words can be used: Names reserved: [name 1], [name 2], [name 3, etc.].
If for some reason your agents or brokers do not understand the “name reserved” language, then use this language: This agreement is void in the event one of these people buy the property: [name 1], [name 2], [name 3, etc.].
* It is always best for the Seller to initial at the end of each “write in” and have the agent or broker initial at the end of the line or sentence, as well.
Note: The “Exclusive Right to Sell” listing form is NOT “the only listing form.” There are several kinds of listing forms, each is its own “standard form” to achieve the objectives for which the form is designed, and usually one of those forms becomes the favorite or “standard” used by a particular real agent or broker. But there is no “standard” form in that any form used must be explained by the agent subject to the review and consent of the Seller.
The terms and conditions of any form are negotiable, though sometimes the agent’s broker or the MLS office may have “rules” for the most and least desired uses or modifications of each particular form. Below is a list of the kinds of forms with which I have been familiar. Ask your agent or broker to list and describe the different kinds of forms your state has made available. If the agent or broker does not know, contact the department of your state’s government that regulates real estate.
The Exclusive Right to Sell = collect a fee when any one buys the property during the listing.
The Exclusive Agency Right to Sell = collect a fee when other agent or the agent on the listing brings the buyer, but the sellers can sell on their own and NOT pay a commission.
The Open Listing = whoever brings the buyer whose offer the seller accepts get the fee.
The “one name reserved” technique can be use on any listing, but it is most powerful on the “Exclusive Right to Sell” listing. This is the form most commonly used by agents.
