Question:
I listed my home with a brokerage, but I have found a buyer on my own. Can I sell my home privately — without the salesperson?
Answer:
In toronto real estate, before listing your home, you would have signed a listing agreement with the brokerage that employs your salesperson. The listing agreement is a binding contract to work with the brokerage for a set amount of time. It’s a serious commitment that should not be taken lightly.
During the time period that the contract is still in effect, you need to tread very carefully in conducting any private arrangements with would-be buyers. Typical listing agreements require you to refer any interested party to the brokerage representing you.
It’s very likely that if you engage in a private sale while the listing agreement is in effect, you will owe commission to your brokerage. With that in mind, you should check the terms of the contract before taking any further action. If you are still not sure, consult with your lawyer.
You should also consider whether you have the time and expertise to negotiate the price, conditions and closing date with the buyer, and handle all the paperwork. Your representative can provide a great deal of guidance with this process. After all, it’s the area of their expertise.
Please note that most listing agreements include a “holdover clause” as well. The holdover clause states that if you enter into an agreement of purchase of sale during a specified period after the contract expires, you may still need to pay commission to the brokerage.
The holdover clause typically applies to potential buyers who were introduced to your property or viewed it while you were under the listing agreement. Depending on the terms of your agreement, it likely would not matter how the buyers were introduced to your home or why they came to see the property, even if they never contacted the listing brokerage or your representative.
I recommend that buyers and sellers read and understand all the contracts they are signing, and that includes the listing agreement. If there’s something in the agreement that you’re not sure about, ask your representative about it. It’s a lot easier to make changes to the contract, or back out entirely, before you sign on the dotted line.
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