Which type of listing agreements does not require compensation for the broker unless they are the procuring cause?

Study for the California Real Estate Broker Exam. Utilize flashcards and multiple choice questions, each with hints and explanations. Prepare efficiently and effectively for your licensing exam!

The correct answer is that an open listing and an exclusive agency listing do not require compensation for the broker unless they are the procuring cause of the sale.

An open listing allows the property owner to engage multiple brokers while retaining the right to sell the property themselves. In this scenario, the broker who brings the buyer is compensated, but if the seller sells the property independently, no commission is owed to any broker.

An exclusive agency listing is somewhat similar; however, the owner also retains the right to sell the property without owing a commission, provided that they do not use the services of a broker. Again, the listing broker is only entitled to compensation if they are the one who successfully finds a buyer.

In contrast, the exclusive right to sell listing does guarantee that the broker will be paid a commission regardless of who ultimately sells the property, whether it is the broker or the owner themselves. This is why other types of listings, such as the exclusive right to sell, do not align with the question's criteria regarding compensation being contingent solely on being the procuring cause.

Thus, the open listing and exclusive agency listing both create situations where the broker's entitlement to a commission relies on their direct involvement in the sale.

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy