DEAR BOB: What is involved when you give a real estate listing agent an “exclusive”? Will the property go on the MLS (multiple listing service)? Can another realty agency show your house and bring a purchase offer? –Craig A.

DEAR CRAIG: There are two types of “exclusive listings.” One is called an “exclusive agency listing.” That means if the home seller finds a buyer without any agent’s help, a sales commission need not be paid to the listing agent.

Purchase Bob Bruss reports online.

However, if the listing agent or a buyer’s agent locates an acceptable purchaser, then the seller owes a sales commission. Because an exclusive agency listing agent lacks full control over the property sale, most agents refuse to accept this type of listing.

The other type is the “exclusive right to sell listing.” That means the listing agent earns the sales commission regardless of whether the seller, the listing agent, a buyer’s agent or someone else produces a buyer. Then the seller owes the full sales commission. This type of listing is strongly favored by realty agents because it gives the agent maximum control and maximum incentive to get the property sold.

Either type of exclusive listing should be put into the local MLS so other agents can show and sell the home. When signing a listing contract, be sure the contract provides for maximum market exposure in the MLS and on the Internet.

Don’t be fooled by an “office exclusive listing,” which means the property will be marketed only by agents in the listing agent’s brokerage firm. Home sellers need maximum market exposure for their listings and the MLS is the most powerful sales tool available.

MUST HOMEOWNER GET A NEW DEED AFTER PAYING OFF MORTGAGE?

DEAR BOB: I paid off my home mortgage a few years ago, but I did not transfer the title. What do I have to do now? –Patricia W.

DEAR PATRICIA: Congratulations. After you paid off your mortgage or deed of trust, the lender must clear your title by either recording a mortgage satisfaction or a deed of reconveyance. That recorded document removes the secured debt from your home’s title. After that is done, you needn’t do anything further.

There is no title transfer involved. Check with your county recorder of deeds office to be sure your mortgage lender recorded the proper document. If not, follow up with the lender now to clear your title.

WHY IS IT BEST TO HAVE A MORTGAGE ON A “BAD HOUSE”?

DEAR BOB: In one of your recent articles you suggested that a reader make a 25 to 30 percent cash down payment even though she could afford to pay all cash for a house. You said, “Then you won’t have a large amount of cash tied up, just in case you buy a bad house.” It would seem to me it would be an equally bad situation whether you paid cash or had a mortgage, which requires monthly payments regardless of any problems with the property. –Len P.

DEAR LEN: It sounds like you are very wealthy so you won’t mind having a large amount of cash tied up in a “bad house,” one which can be difficult or impossible to sell.

If you instead had a mortgage on a bad house, you would still have most of your liquid cash available in the bank or elsewhere. The primary reason I favor obtaining a mortgage when buying a house or condo is so you don’t become property rich but cash poor.

The new Robert Bruss special report, “Everything Home Sellers and Their Realty Agents Need to Know About the $250,000 Tax Exemption Rules,” is now available for $5 from Robert Bruss, 251 Park Road, Burlingame, Calif., 94010, or by credit card at 1-800-736-1736 or instant Internet delivery at www.BobBruss.com. Questions for this column are welcome at either address.

(For more information on Bob Bruss publications, visit his
Real Estate Center
).

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