An Unrepresented Seller Compensation Agreement Is Commonly Used in What Type of Transaction

When it comes to real estate transactions, it`s important for all parties involved to have a clear understanding of the compensation and fees involved. One type of compensation agreement that is commonly used in certain types of transactions is the “unrepresented seller compensation agreement.”

An unrepresented seller compensation agreement is an agreement that outlines the compensation that will be paid to the listing agent if the seller does not have their own representation in the transaction. In other words, if the seller is not working with a real estate agent, the listing agent may be entitled to a higher commission fee.

This type of agreement is typically used in transactions where the seller is not represented by an agent, but the buyer is. For example, if a buyer is working with their own agent to find a property, but the seller is selling their home as a “for sale by owner” (FSBO), the listing agent may require an unrepresented seller compensation agreement in order to represent the seller`s interests in the transaction.

The reason for this is that the listing agent will be doing more work than they would in a typical transaction where both parties have their own representation. In a typical transaction, the buyer`s agent and the seller`s agent split the commission fee. However, in a transaction where the seller does not have their own representation, the listing agent takes on more responsibility and therefore may be entitled to a higher commission fee.

It`s important for both the buyer and the seller to be aware of the compensation agreement and understand how it will impact the transaction. The agreement should be included in the listing agreement and clearly outlined so that both parties can make informed decisions.

In conclusion, an unrepresented seller compensation agreement is commonly used in transactions where the seller is not represented by an agent but the buyer is. This agreement outlines the compensation that will be paid to the listing agent if the seller does not have their own representation in the transaction. It`s important for both parties to be aware of the agreement and understand how it will impact the transaction.

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