Principal broker A and a seller agree to an open listing. Principal broker B obtains a second open listing from the seller and produces a buyer who is ready, willing, and able to close on the seller's home. Which statement is TRUE of this transaction
Principal broker B will earn the full commission if the buyer performs.
In an open listing, multiple brokers can represent the seller, and the seller only owes a commission to the broker who brings in a successful buyer. Since Principal broker B produces a buyer ready to close, they are entitled to the full commission as per the terms of the open listing agreement.
This statement is not true because, in an open listing scenario, Principal broker B is not required to communicate with Principal broker A regarding the offer. Each broker operates independently, and the seller handles the agreements directly with the brokers involved.
This statement is incorrect as open listings allow only the broker who successfully brings the buyer to receive the full commission. Since Principal broker B produced the buyer, they will not share the commission with Principal broker A.
This is false because the seller is only obligated to pay a commission to the broker who successfully closes the sale. In this case, since Principal broker B facilitated the transaction, the seller is not required to pay Principal broker A any commission.
In open listings, the broker who secures a buyer earns the commission, which underscores the competitive nature of such agreements. Principal broker B, having produced a ready, willing, and able buyer, is entitled to the full commission upon the closing of the transaction. This structure incentivizes brokers to actively seek buyers, while the seller remains free to work with multiple brokers without incurring unnecessary commission obligations.
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