Can You Change a Listing Agreement (North Carolina Real Estate)

North Carolina Real Estate Agent Eric Andrews discusses listing agreements. Listing agreements and offer to purchase letters have been prepared by the North Carolina Association of Realtors and the North Carolina Bar Association. Many parts of these contracts may not be changed. Seller’s names and agent commissions are a couple things that people frequently request to change. However, these are complex legal documents. If you have a change you’d like to make, you need to go over it before signing it.

Speaker 1:                           Can you change your listing agreement?

Eric Andrews:                    Well, there are blanks in there that you can change. So there’s some things. But some people get into the nitty gritty and they like to change some of which is written into the contract, besides the blanks. And people need to know that the listing agreement is written in conjunction with the North Carolina Association of Realtors and the North Carolina Bar. Same thing with the offer to purchase. So there are things that we need to figure out. Like, we need to figure out who the seller is. And you think that would be pretty straightforward, but North Carolina is what is known as tendency of the entireties. And people will say, “Oh, I bought that before I married her,” or, “I inherited that. That has nothing to do with my husband.” No, if you wish to sell real estate and you’re married, you need spousal permission.

The saying that we have in North Carolina is, “One to buy, two to sell.” You can go out there and buy whatever you want. But if you’re married and you want to sell property, you need that. So technically, nitty gritty, the spouse doesn’t have to sign the listing agreement but they have to sign the deed. So they’re going to need to be involved in the process. It’s best practice. So we need to figure out who the seller is and people can’t modify that. The seller is the seller. A lot of people will try to be cutesie and come up with these LLCs. And if the deed’s not in the LLC, that’s not who’s selling the property.

We need to address what we are selling. And I know that seems like real, real simple, but especially with land, people try to sell ideas. And they’re like, “Oh, Eric, I have this 10 acres. I think there’s three or four acres on the other side of the creek. That’s what I want to sell.” We can’t sell ideas. We have to have actual property. And you could mark it out and you could have a surveyor come out there. And it doesn’t have to be recorded, but then you’re getting into a lot of different situations. We don’t know whether or not the way you’re subdividing it is acceptable to the county.

Speaker 1:                           What are some of the other things that people want to change about a listing agreement?

Eric Andrews:                    They want to change the commissions. Nobody likes how much we charge [inaudible] of commissions. That’s fine to do, I’m all about negotiations. If you have a multimillion dollar property, I’ll work with you. If you have something that’s on the highway, I’ll work with you. So people want to change the commissions. What I don’t like, is when we try to change the commissions afterwards. So I sign you on for 10% and we’re at $100,000 and you get an offer for $90,000, “Yeah, I’ll do it. But you got to reduce your commission.” No, I’m not doing that. We had the commission discussion now at the time of the listing agreement, I don’t wish to negotiate that number when we’re in the midst of negotiations.

The other thing that people need to realize, is that this listing contract is a contract. It’s a contract between the firm and the seller and there are certain obligations. So when people say, “Yeah. Eric, sorry, I changed my mind.” Well, that’s great. But I have paid administration costs, I’ve paid MLS costs, I’ve paid for drone photography, I paid a professional photographer, I may or may not… So there should be, in there with your clients, a release amount or something to negotiate. But at the very least, you have to have a conversation with the seller. Look, on a standard listing, I’m going to have about $1,500 in it. On something bigger, more expensive, I might have $2,500 in it. There are some properties that I invest five to $10,000 in marketing and videos and everything that we’re doing. So it’s not just, “We changed our mind.” There could be some fees involved. And hate to be mean about that, I always want to work with my clientele. But there’s money in and people need to be aware of that.

And the last thing is when people read the contract, I think they don’t realize that if they strike something out of it… This contract is like a well-balanced machine. So if you take and strike something out from another area, it can offset something unexpectedly in another area of the contract. We’re certainly not allowed, as real estate agents, to modify it. The seller’s allowed to modify it. But I just have to say upfront and being real, real blunt here, if I have a seller that is going through and wordsmithing and striking out words or adding stuff to the contract, that’s probably not the kind of client I want to work with if you’re being that picky on the front. I’m okay with being detail oriented, there’s nothing wrong with detail, but I don’t like messing around with a contract, a listing contract that’s already been improved by a bunch of attorneys and the North Carolina Association of Realtors.

Speaker 1:                           Do you have any recent examples of somebody trying to change a contract?

Eric Andrews:                    Yeah, absolutely. Yeah, they’ll modify things as far as, “I don’t have to have my spouse to sign.” That’s the law. I can’t change that. I’ll have people strike, there’s a section in there where if I bring you a buyer and then the real estate listing expires, and then a week later, you sell them to those people. I still get paid. That’s fair. And people will try to strike that out. “I’m not paying you. Once it expires, it expires.” No. If a buyer comes in the last week and I’m the one that brought the two parties together, I deserve to get paid. So it’s that kind of stuff. The small modifications.