How to Legally Break a Contract With a Broker

How to Terminate a Contract With a Real Estate Broker

If you’ve signed a contract with a real estate broker, you are not exactly stuck with that agent for the full duration indicated on the contract. Standard real estate agent contracts include clauses for opting out of the agreement. You are also legally able to terminate the contract if you can prove that the agent is not honoring his contractual duties. Depending on your reasons for terminating the contract, breaking the contract will be simple, or cause a lot of stress and anxiety. If you are armed with enough knowledge on the subject, the process will be a lot easier on you.

Depending on the situation, it may actually be beneficial for your agent to terminate the contract too. A real estate contract is always easier to break if both parties agree to the termination. For example, if you have decided that you do not want to sell your home, then the broker will almost always agree to cancel the contract. There is no point for the real estate agent to spent time and money promoting your home if you are not fully committed to selling. However, if you are simply not satisfied with the agent’s services, then she may not be as eager to break the contract.

When working with a large, nationally recognized real estate company, you can often opt out of a contract at your discretion, provided you agree to sign a new contract with a different agent in the same company. This is a good option if you trust the real estate agency but are unsatisfied with your individual agent. However, it will be fully necessary to tell the real estate agent what you are dissatisfied with. The agent will then have a predetermined duration of time to remedy the situation; otherwise you will be allowed to terminate the contract.

If you are unable to simply reason with the broker or find an appropriate opt-out clause, then you will have to find some concrete legal evidence that the real estate agent has not performed his duties. Each states have different real estate laws on this matter. Most contracts outline the duties of the real estate broker. You need to study these carefully, and be sure to document any and all instances where the agent didn’t live up to the agreement. If the agent does not fulfill these contractual obligations, you can legally break the contract.

Seek contract termination in the County Court. If you are unable to find any other way to cancel the contract, go before a judge to break the agreement. If specific contract terms were not violated, you may still be able to prove a breach of contract if you can show that the broker did not do “due diligence” in selling the property. In other words, if the broker did not give your listing as much attention as would be expected of a competent real estate broker, then you can show a lack of due diligence.

Check out this article from Realtor.com to find out more information on: Can You Cancel a Real Estate Contract? and watch this great video that explains in further detail about How to Get Out of a Realtor Contract

How to Legally Break a Contract With a Broker

One thought on “How to Legally Break a Contract With a Broker

  • March 1, 2016 at 8:04 pm
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    Before you enter into a handshake agreement, do your homework. Ask friends for references or check out online agent reviews. Going to open houses is a good way to meet agents who work in the neighborhood you are looking to buy.

    As time goes on, you may find that the relationship just isn’t working. Be honest and upfront before too much more time passes. Offer the agent constructive feedback about why it’s not working for you, and give them examples. It’s possible after an open dialogue the agent will do a better job for you.

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