New York Real Estate Salesperson ExaminationNew York State Specific Laws and RegulationsMedium
A real estate broker has an exclusive right-to-sell agreement with a seller. The seller finds a buyer on their own, without any assistance from the broker. What is the broker's entitlement to a commission in this scenario?
- AFull commission, as specified in the exclusive right-to-sell agreement.
- BA reduced commission, to cover the broker's marketing expenses.
- CNo commission, as the broker did not directly procure the buyer.
- DOnly a commission if the broker had an 'exclusive agency' agreement.
Show answer & explanationAnswer & explanation
Correct answer: A. Full commission, as specified in the exclusive right-to-sell agreement.
An exclusive right-to-sell agreement guarantees the broker a commission regardless of who procures the buyer, even if the seller finds the buyer independently. This is the most protective agreement for the broker.
Why the other options are wrong
- B. A reduced commission is not standard for an exclusive right-to-sell agreement; the full agreed-upon commission is due.
- C. This would be true for an 'open listing' or, in some cases, an 'exclusive agency' agreement, but not an 'exclusive right-to-sell'.
- D. In an 'exclusive agency' agreement, the seller retains the right to sell the property themselves without owing a commission to the broker. This option describes the opposite of the question's premise.
Exclusive Right-to-Sell Listing
A listing agreement where the seller grants the broker the exclusive right to sell the property and promises to pay a commission if the property sells during the listing period, regardless of who finds the buyer.
- Broker earns commission even if seller finds buyer.
- Most common type of listing.
- Provides maximum protection for the broker.
Memory trick: Exclusive right, broker's might, commission's light.