An oral agreement to sell a parcel of residential real estate for a commission is a legally binding contract that outlines the terms and conditions of the sale between the seller and the real estate agent. This type of agreement is commonly referred to as an “oral listing agreement.”
While it is not recommended to conduct real estate transactions through verbal agreements alone, they can still be considered legally binding under certain circumstances. However, it is important to note that the enforceability of oral agreements varies from state to state, and some may require written agreements to be legally valid.
In general, an oral agreement to sell a parcel of residential real estate for a commission should include the following details:
1. Identification of the property: The agreement should clearly identify the specific parcel of residential real estate that is being sold, including its address and legal description.
2. Commission rate: The commission rate, or the percentage of the sale price that the real estate agent will receive as compensation for their services, should be clearly stated in the agreement.
3. Duration of the agreement: The length of time that the agreement will remain in effect should also be included, such as the start and end date of the listing.
4. Terms of the sale: Any specific terms of the sale, such as the closing date or any contingencies, should also be included in the agreement.
It is important to note that oral agreements can be difficult to enforce in court, especially if there is no evidence of the terms that were agreed upon. To avoid any potential disputes, it is recommended to have a written agreement in place that clearly outlines the terms and conditions of the sale.
In conclusion, while an oral agreement to sell a parcel of residential real estate for a commission is possible, it is advisable to have a written agreement in place to ensure that all parties are clear on the terms and conditions of the sale. It is also important to consult with a licensed real estate attorney to determine the enforceability of oral agreements in your state.