Real Estate Chapter 12 Key Terms

Exclusive Authority to Purchase

A buyer-representation agreement giving one broker exclusive rights to represent the buyer in finding and negotiating property. The broker earns a commission no matter who finds the property during the agreement term.

Exclusive Right to Sell

A listing agreement where the broker has exclusive rights to market and sell the property. The broker is paid commission regardless of who sells it — even if the owner finds the buyer.

Exclusive Agency Listing

A listing that gives one broker the right to sell the property but allows the seller to sell it themselves without paying a commission. Commission is only owed if the broker (or another agent) finds the buyer.

Existing Loans and Liens Clause

A clause in a sales contract or listing that discloses any current loans, liens, or debts tied to the property. It alerts the buyer to outstanding financial obligations that could affect title or closing.

Multiple Listing Service (MLS)

A shared database used by brokers to list properties and share information. It allows cooperating brokers to market listings and split commissions, expanding exposure to potential buyers.

Net Listing

A type of listing where the seller sets a minimum acceptable price, and the broker keeps any amount above that as commission. Legal in Texas but discouraged by TREC because it can easily create conflicts of interest.

Listing Agreement

A contract between a property owner and a broker that authorizes the broker to market and sell the property. It outlines terms such as price, commission, duration, and duties of both parties.

Lead-Based Paint Disclosure

A federal disclosure form required for homes built before 1978, warning buyers or tenants about possible lead-based paint hazards. Sellers and landlords must provide this disclosure before a contract is signed.

Open Listing

A non-exclusive agreement allowing the seller to list the property with multiple brokers or sell it themselves. Only the broker who brings the buyer earns the commission.

Parties to a Listing Agreement

The broker (and their sponsored sales agent) and the property owner (seller). These are the only legal parties to a listing contract — not the salesperson directly, since all listings belong to the broker.