Real Estate Contract Expiration: Now What?

Real Estate Contract Expiration: Now What?
  • Opening Intro -

    If your home has been on the market for several months and remains unsold, you may wonder how much responsibility your real estate agent should bear for not finding a buyer.

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Assuming that your home is in excellent shape, is priced correctly and is in a stable market, receiving a strong offer within the first month or two is normal. Most listing contracts expire within six months, which allows you and your spouse to seek a new agent or attempt to sell the home yourself. Before you forget your current agent, you’ll need to keep some things in mind to avoid an agent’s commission claim on the eventual sale of your residence.

1. Work with a real estate attorney. Your real estate contract has expired, but you may not be entirely off the hook just yet. Contact a real estate attorney, perhaps the person you will be using a closing, and have this professional review your contract. You may be required to pay a commission if a buyer had previous contact with your agent. Your attorney can guide you here by helping you prepare to sell your own on your own.

2. Market your home directly. Take an advertisement out on a “For Sale by Owner” website, adding details about your home including multiple photographs. Use a contact email address and a cell phone number to help potential buyers reach you. This information can also be included on one or more FSBO signs placed strategically on your lawn and in accordance with local zoning requirements.

3. Show your home to qualified buyers. You’ll want to vet or screen potential buyers to ensure that these people can afford to buy your home. When someone wants to see your home, ask if they’ve been pre-qualified for a mortgage. Without that condition, you will show your home to many more people than necessary, spending wasteful time that you cannot afford to lose.

4. Receive offers. Allow buyers to submit their best offers. Negotiate a deal and take your attorney-supplied sales contract to your attorney for his review. Your attorney will ask you if this person had contact with your real estate agent and will determine whether a commission is owed.

5. Go to closing. If your buyer was referred by your agent, then your attorney can contact this person to offer an amount to settle the commission. Typically, homes sell with a 6 percent commission with the selling agent getting 3 percent. Instead of receiving 3 percent, your former agent may accept a flat-rate fee that comes in for less than her commission amount. Your attorney will draw up the necessary paperwork to cover this requirement.

Considerations

You can still go to closing if the matter between you and the agent is not settled until later. Your attorney may instruct you to set aside the commission cost until a final settlement has been made.

ReferenceRealtor.com: After My Contract With An Agent Expires, Can I Sell My Home On Land Contract?

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Last update on 2019-05-31 / Affiliate links / Images from Amazon Product Advertising API

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Categories: Home Selling