Chp 2

Section 1

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Section 2

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Section 3

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Section 4

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Rescission rights

A buyer can rescind the purchase agreement if she doesn't receive a disclosure statement or if she doesn't like any of the information included int he disclosure statement. The right of rescission lasts or three or five days, depending on how he disclosure statement was delivered. If the buyer rescinds, she is entitled to a full refund to the good faith deposit.

Termination

A listing agreement will terminate on its expiration date or when the sale of the property closes. It will also terminate if the broker dies, goes out of business, or has her license suspended or revoked. The seller and the broker may mutually agree to terminate the listing, or one party may decide to terminate the agreement on his own. However, if one party terminated the listing agreement unilaterally, he may be liable for breach of contract.

Safety clause

A safety or extender clause provides that if the seller sells the property within a specified period after the expiration of the listing agreement to someone that the agent introduced to the property, the seller must pay the agent the commission.

Signatures

All of the sellers must sign the listing agreement. If a seller is married, the seller's spouse should sign the agreement as well. If the listing agreement is signed by an attorney in fact, the power of attorney should be recorded. If the property is owned by a legal entity, the listing agreement may be signed by an authorized corporate officer, a general partner, or a trustee. If the property is part of an estate, he agreement must be signed by the personal representative

Procuring cause

An agent is the procuring cause of a sale if the agent located the buyer and helped negotiate the sale.

Transfer disclosure statement

California law requires a seller of residential property to give the buyer a complete transfer disclosure statement regarding the property. The seller must complete the disclosure form and give it to the buyer as soon as possible after the purchase agreement is signed.

Disclosure of defects

Even if a known defect is not the subject of any question in the transfer disclosure statement, the seller and agent still have the duty to disclose that defect to potential buyers. The listing an cooperating agents must visually inspect the property and disclose an material facts on the transfer disclosure form.

Net listing

IN a net listing, the seller sets the net amount she wishes to receive from the sale of the property. If the property sells for more than this amount, the broker is entitled to keep the excess as the broker's commission. Net listing are only legal in California if the brokers reveals the amount of the commission before the seller commits to the transaction

Residential earthquake hazards report

If a house was built before 1960, the seller must give the buyer a pamphlet on earthquake safety. The required pamphlet contains a form in which the seller must disclose to the buyer whether or not the property has been improved in key ways that will minimize earthquake damage.

Natural hazard and disclosure statement

If a property is located in an area designated as being as increased risk for natural disasters, such as earthquakes, flooding, or forest fires, this must be disclosed on a natural hazard disclosure statement. A listing agent should verify whether a property is in a designated hazard area, using maps issued by the appropriate state or federal authorities.

Hold harmless clause

In a listing agreement's hold harmless clause, the seller agrees to take responsibility for the information given to the agent int he listing agreement. If the agent and broker get into legal trouble because of the information provided by the seller, the seller will reimburse the broker for legal expenses.

Exclusive agency listing

In an exclusive agency listing, the seller agrees to pay the agent a commission if anyone other than the seller finds the buyer. If the agent or any other real estate licensee finds the buyer, the agent is owed a commission. If the seller located the buyer, no commission is owed to the agent.

Exclusive right to sell listing

In an exclusive right to sell listing, the seller agrees to pay the agent a commission regardless of who finds the buyer. This is the type of listing agreement that is used most often.

Open Listin

In an open listing agreement, the seller agrees to pay the agent a commission only if the agent is the person responsible for bringing about the purchase agreement between the buyer and the seller. The agent must be the procuring cause of the sale. Open listing agreements are rarely used.

Mello-Roos Lien disclosure

Many properties are subject to Mello-Roos liens, which secure local special assessment levies or community improvements. If a property is subject to such a lien, the seller must disclose it by giving the buyer a copy of the notice from the appropriate taxing authority

Pre-printed listing forms

Multiple listing services require their agents to use pre-printing listing agreement forms. These are detailed contracts that include more than just the basic elements required for a valid listing agreement

Listing agreement modification

Once a listing agreement has been signed, it can be modified only with the written consent of both parties. The written changes should also be dated, to avoid confusion. Changes should usually be made on a special addendum or amendment form, especially i the changes are numerous or complicated

Commission rate

The commission rate must be fully negotiable. here can be no "mandatory" or "standard" rate of compensation. California law requires that the listing agreement contain a notice in boldface type that commission rates are negotiable.

Lead-based paint disclosure

The seller of a home built before 1978 must disclose whether or not there is lead-based paint present on the property. The buyer has 10 days in which to have the property inspected for lead-based paint, during which time she may rescind the purchase contract

Listing agreement

To be enforceable by the broker, a listing agreement must be in writing and signed by the seller. At a minimum, a listing agreement should contain a property description, state the required terms of sale, establish the scope o the broker's authority, and include a promise of compensation. An exclusive agency or exclusive right to sell listing must also have a termination date.

Listing input sheet

When you take a listing, you will also fill out a listing input sheet for submission to the multiple listing service. This form provides detailed information about the property for MLS agents who might be interested in showing it buyers. The input sheet should be treated as part the listing agreement.