A real estate commission agreement is a written document stating all the terms and conditions of real property exchange. Although property exchange takes place between a buyer and seller, the agreement is arranged between a realtor or real estate agent and buyer or seller or both.
Agents are mostly paid through their prescribed fees which can be negotiated but most agents ask for a defined percentage of the amount used while purchasing the property. It is a legal document and can be used in a court of law to prove the stance of any party.
It is always advised to hire a real estate agent for purchasing or selling property as they are more aware of the property and the different aspects related to it. Moreover, agents are very good at negotiating and closing the deal as they are much aware of the property value and can promote it in a proper way. Many people are confused and cannot take a step forward unless assured thus, agents provide assurance and help in the entire process.
Agents working on commission charge their clients based on how much the house will sell for. It means that the higher the selling price, the higher will be the commission of the agent.
A template of the real estate commission agreement is provided below,
Template for the Agreement
This agreement is drafted on date (__/__/__) between following parties,
Name: Joshua Smith
Address: 34 Hill Road. London, England
Contact: [244 355-8292]
Name: Derek Hugh
Address: 23 Main Boulevard. London, England
Contact: [244 345-3466]
Terms and conditions of the real estate commission agreement are mentioned below,
- This agreement shall commence from the date [DATE] and should be taken legally.
- Both parties associated with the property either the buyer or seller shall pay a commission to the agent.
- Commission will be 1% of the amount that closes the deal of property.
- All the commission will be paid in cash. No electronic transfer or cheques are applicable.
- Commission will be paid in a single installment within a month of the deal.
- The agent will be entitled to the commission regardless of the money situation between the buyer and the seller.
- Once the deal is closed and the agent has been paid, any return from that point will not affect the agent.
- This agreement will be valid for a period of 2 years and after the period is over, it would be nullified.
- If any dispute occurs between the buyer and seller, then the agent will be responsible for making things right.
- If the buyer does not pay the price of the property in due time then the agent will be held accountable.
- The presence of legal counsel for both parties is mandatory to ensure that everyone involved in the agreement is aware of their rights.
- The presence of witnesses will be assured to ensure that the process runs smoothly.
Buyer / Seller: Joshua Smith