A legally binding document grants a real estate brokerage the sole authority to represent a seller in the sale of a property. This agreement, often presented in a portable document format for easy access and distribution, ensures that the brokerage receives a commission if the property sells during the agreement’s term, regardless of who finds the buyer. For instance, even if the seller independently finds a buyer, the brokerage is still entitled to the agreed-upon compensation.
Its importance stems from the clear delineation of responsibilities and the security it provides to the real estate professional. It incentivizes the brokerage to invest time and resources in marketing the property effectively. Historically, these agreements evolved to protect brokerages from expending efforts without guaranteed compensation, fostering a more professional and reliable real estate transaction environment.
