Question

A homeowner desires to sell his or her home and signs an exclusive-listing agreement, requiring payment of a six percent commission to the real estate agent. If shortly thereafter, but before the agent has time to do anything to sell the property, the owner surprisingly finds a couple who purchases it for $400,000, the homeowner:________
a. must pay a commission of $12,000, but is entitled to retain the other half because he or she found the buyer.
b. must pay a commission of $24,000 to the listing agent.
c. is not obligated to pay a commission.
d. is not obligated to pay a commission, unless the agent has placed the listing in the local multiple-listing service.

Answer 1

Answer: B. must pay a commission of $24,000 to the listing agent.

Explanation:

An exclusive listing agreement is a contractual agreement whereby a listing broker acts as the agent and in this case, the seller will pay a commission to the listing broker.

Since the homeowner has already signed an exclusive-listing agreement, which requires payment of 6% commission to the real estate agent but later finds a couple who purchases it for $400,000. In this case, the homeowner must still funlfil the terms of the contact and pay the listing agent the percentage that was agreed as commission and this will be:

= 6% × $400000.

= $24000

Therefore, $24000 must be paid to the listing agent.