So I got a call off a Craigslist "We buy houses in any condition" ad. The seller just listed on the MLS with an agent and I checked out the listing, house is clean and in pretty good condition. There doesn't seem to be a need for them to sell quickly for cash, just kicking tires seeing if they can get a cash offer that would end up being more beneficial than getting their full asking price through a realtor. Regardless of the fact that I don't think they would sell at a deep discount, my question is - Aren't they bound to sell through their agent since they have listed it on the MLS? Like, someone can't have a property listed with an agent, then go find a cash buyer on their own and cut out the agent completely, right?
@Jeremy Baxter It depends on the terms of the listing contract. It's almost always (at least here in MA) an "Exclusive Right to Sell". In that case, the seller pays the commission regardless of who produces the buyer.
In a very few cases it could be an "Exclusive Right to Sell - with Named Exclusion", meaning that the seller has named a particular person(s) who can buy the property with no or reduced commission paid.
In even fewer cases (almost never) it could be a "Non-Exclusive Right to Sell", meaning that the seller can sell it on his own without paying commission. If an agent brings the buyer, he does pay commission. However, in my market, a Non-Exclusive cannot be listed on MLS.
Of course, now that it's listed, it's going to sell at market value, so you're out of luck.
So most likely, yes. The seller will have to pay a commission to the agent.
@Charlie MacPherson Thank you very much for your response and for the education. That is what I thought, but now I can in turn communicate with the seller using that official terminology. I appreciate it!
@Jeremy Baxter No problem whatsoever for you to negotiate directly with the seller. Make your offer as if it was off-market. If the seller accepts they will most likely have to pay the commission they agreed to pay.
In my business of taking over payments and doing lease options I find that often on houses listed with agents I have to give the seller enough down to cover the commission because the agent is unwilling to wait until closing.