Breaking Up Isn't Hard To Do: Canceling A Listing Agreement With A Realtor

23 February 2017
 Categories: , Blog

If you sell your house, you make a listing agreement with a realtor. The realtor does everything to sell the property. However, you may find you want to change realtors, but you are afraid you can't break the contract.

Signing a listing agreement doesn't make you obligated to the realtor forever. Here are legal ways to break a realtor listing agreement.

Review The Contract

Study the agreement to find out cancellation procedures. Look for the Protection Clause. This clause will tell you if penalties or commissions apply. It also keeps buyers and sellers from making deals to avoid paying agent commission soon after cancellation.

Check the expiration date. Most listing agreements last up to six months. It is wise to wait for the expiration date, if it is close.

Think of Reasons to Cancel 

Check "Duties and Obligations" in your contract. Try to think of promises the agent didn't keep, and get proof. This will give you legal grounds to terminate immediately. Some other reason to cancel could include:

  1. Lack of communication: Is the realtor providing you updates as you requested? Before you cancel, give the realtor a chance to improve.
  2. Poor photographs: Is the photo of your house professional? Bad photos will kill a sale faster than poor wording.
  3. Listing Not Found on Internet: Search your listing with a major search engine. If you don't find it, it is a legitimate reason to cancel.

​It is also acceptable to cancel in cases of job loss or illness. Unacceptable reasons to cancel include choosing a less expensive realtor, or as mentioned above, selling to a neighbor or friend yourself to avoid paying commission.

Send the Realtor and Agent a Letter

Write a letter to the agent and broker explaining why you are unhappy or why you can't continue.  Agree to pay termination fees and commission owed, if the house is sold by the original agent before the cancellation. To avoid this, don't have an open house.

Send the letters by certified mail. The realtor may terminate the contract mutually, or they may send you a cancellation contract before terminating the listing. Ensure you understand each section of the document. There may be a clause that prevents you from re-listing the home for a time period. If the realtor doesn't cooperate, take it to the Board of Realtors in your state. 

Don't relist the home too soon. Wait several months before you relist to help give you a new "Days on Market" and to avoid having to pay any commissions to the previous agent. Take new pictures of the property. Ensure the new agent doesn't copy the old listing.

It is rare for a realtor to take a seller to court. If you find yourself facing court, or the realtor still won't cancel the agreement, contact a real estate lawyer like Steve Butcher Sr.