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Which of the following statements regarding an open listing is correct?

Rationale

The listing agreement should be in writing and signed by the seller.

A written and signed listing agreement is essential as it provides a clear record of the terms agreed upon by the seller and the broker, ensuring legal enforceability and clarity in the transaction process.

A (The listing agreement may be renewed automatically without signature) YOUR ANSWER

An open listing agreement typically does not have an automatic renewal provision. Instead, it usually requires explicit agreement from both parties to continue the listing, making it necessary for both the seller and the broker to agree on any terms for renewal.

B (No matter who sells the property, the listing broker is entitled to a fee) YOUR ANSWER

In an open listing, the seller retains the right to sell the property independently without owing a commission to the broker. This means that if the seller sells the property themselves, the listing broker would not receive a fee, contrary to the statement's assertion.

C (If the seller sells the property, commission is still due) YOUR ANSWER

This statement is incorrect because, in an open listing, the seller is not obligated to pay a commission if they sell the property themselves. The broker is only entitled to a commission if they are the one who facilitates the sale, highlighting the non-exclusive nature of open listings.

Conclusion

The defining characteristic of an open listing is its non-exclusive nature, allowing the seller to sell the property independently without incurring commission fees to the broker. The necessity for a written and signed agreement (option D) ensures clarity and legal standing in the arrangement, while the other options misrepresent the terms and conditions associated with open listings.

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