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How to Cancel a Listing Contract

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home is not for sale

When sellers cancel a listing, they can expect a ton of phone calls from agents who have suddenly developed an interest.

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Question: How to Cancel a Listing Contract
A reader asks: "We live in a rural community in Texas, and all of the agents in this area know each other. There are not a lot of homes or acreage for sale. Problem is our home has been on the market for 15 months and nobody has made us an offer, not even a lowball offer. I don't know what else our agent could do. Maybe it's because we have a really small third bedroom. Anyway, I want to cancel the listing so we can hire a bigger brokerage over in the next county. But we don't want to hurt our agent's feelings. It's just that we think it's time we got an agent with a bigger budget and reach. How do we cancel a listing?"
Answer: You don't. At least not right away. Oh, there are ways to cancel a listing contract, and I will explain them to you, but first let's talk about your situation and your listing. The way I understand small communities, your home is probably listed in the local MLS. I imagine your listing is online so everybody has equal access to home listings.

The target audience for your home is either a potential buyer who lives in the community or a buyer who is moving there from elsewhere. I doubt your buyer is a person who hasn't been born yet. Now that we've narrowed the odds, you should ask your agent what she has been doing to market to these two groups of potential buyers. Ask her if a new agent would do something differently.

Nine times out of ten, your existing agent is most likely marketing your home in a similar fashion to the efforts a new agent would expend. If your agent is experienced, you might want to reconsider canceling the listing. In many small communities, it can take years to sell a home. It's not exactly fair to penalize your agent and take the listing away from her when she's expended time and trouble for which she will no longer be paid.

However, sometimes what you need is a fresh approach. Below are a few reasons to consider:

Reasons to Cancel a Listing

  • Poor communication. If you prefer daily or weekly updates from your agent and have asked for it, and she does not provide it, that's a good reason to cancel a listing. But first, give your agent an opportunity to improve her communications skills. Don't just yank the listing away.

  • Bad photographs. Photos are the most important aspect of marketing. An agent can misspell words or use the wrong words and a home will still sell. Mess up the photos, though, and you're pretty much hosed. Look at your photography. If it's not professional grade, you might want to cancel the listing.

  • No Internet Exposure. Put your property address into a search engine such as Google. For example, I entered the address of a listing I have in Land Park, Sacramento, and it returned 25,400 results on 153 websites. Everybody is online, even those who live in a small community.

  • Mismatched personalities. Sometimes, you don't get to know a person until you have worked with that person. You might be an over achiever paired with an under achiever. You might want the facts and just the facts, ma'am, but the agent might lean toward a passive nature. It's OK to cancel a listing if your personalities do not mesh.

  • Unethical behavior. Agents rarely set out to be unethical but it can happen. If you feel that your agent is not representing your best interests, it might be time to cancel the listing and look for a new agent.

Unacceptable Reasons to Cancel a Listing Contract

Some reasons are completely unreasonable and unacceptable. While they might make perfect sense to you, I bet you will have a hard time finding any real estate agent who would agree to cancel a listing due to the following:

  • A seller decides to renegotiate the commission.
  • A seller wants to relist with a less expensive company, maybe a discount agent.
  • A seller wants to sell a neighbor or a friend and not pay a commission.

Steps To Cancel a Listing Contract

Most residential listing agreements are a bilateral contract, meaning the agent must perform and the seller must perform. The first step to cancel a listing contract is to establish the grounds for a cancellation. Review the reasons above to determine if any are applicable to your situation.

  • The time to ask about how to cancel a listing is when you sign the listing contract. Ask your agent if she will release you if you are unhappy.

  • Tell your agent immediately if you want to cancel. Do not delay this communication. It is best to put your request in writing and document your expectations. Email suffices.

  • Realize that your listing is between the brokerage and you, not you and your agent. If you are unhappy with your agent, it might be entirely permissible and easier on everyone if you ask the broker to assign another agent to you.

If you have laid out the reasons that you want to cancel the listing and the agent refuses, you might have to hire a lawyer. There is no guarantee that a lawyer will get you the outcome that you desire.

At the time of writing, Elizabeth Weintraub, DRE # 00697006, is a Broker-Associate at Lyon Real Estate in Sacramento, California.

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