u/CiscoLupe

Seller's broker gets half of seller's earnest money if buyer breeches (Texas)

Is this a normal part of the seller contract?
I have asked 4 different realtors for a contract that I can read over before signing. Only two would send me a contract.

One realtor sent the contract and I asked him to remove that paragraph. He said it's state law and can't be changed.

I asked the other realtor the same. She said she'd get with her broker.

I tried to post a snip of the paragraph, but reddit would not let it go through.

Edit to add. The bot told me to answer these questions

Please make sure you have included the following information in your post.

  • Location - south Texas
  • Have you asked your broker, team lead/mentor, or an attorney? - Yes
  • Buyers/Sellers/Clients : I haven't hired anyone yet, but I have spoken to several realtors
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u/CiscoLupe — 3 days ago

Well in my last post. I mentioned that one realtor sent me a blank contract. The other realtor I'm thinking about using sent a contract that I've been slowly going over. The first thing I noticed was that it's for a full year. I'm thinking about asking for 6 months instead.

Not finished reviewing but decided to run the contract through AI. Something I didn't notice was dual agency allowed (according to AI). I had asked the realtor about this (because the contract kind of seemed like it did allow it). He said he doesn't believe in it. But AI says the contact allows for it.

Here is the whole breakdown from AI. Please tell me if some of this stuff is standard or if I should be pushing back.

Sorry, this is going to look extra long. I tried to put the info into a google doc and share a link, but I got a warning. So pasting text below
Thank you

Here’s a plain‑English risk/concern review of your Texas listing agreement. I’ll focus on provisions that could cost you money, limit your flexibility, or create liability.

🔴 Biggest Concerns / Risks

1) You owe commission in more situations than just a sale

  • Commission is earned if any of these happen:

👉 Why this matters:
You could owe ~6% commission without a completed sale.

2) Long commitment (12 months)

👉 Concern:

  • You’re locked into this broker for a full year.
  • No easy exit clause is visible.

✅ Tip: Many listings are 3–6 months.

3) Protection period (tail) still triggers commission

👉 Meaning:

  • If someone the agent showed the home to buys later → you still owe commission.

4) You must pay even if BUYER defaults

  • If a buyer backs out and you keep earnest money:

👉 This is often overlooked and surprises sellers.

5) Exclusive listing = you can’t self-sell without paying

👉 Even if:

  • You find the buyer yourself
  • A friend/family member buys

➡️ You still owe the full commission.

6) 6% total commission (3% + 3%)

👉 Concern:

  • Still standard, but fully negotiable (contract says so).
  • You are locked into this rate once signed.

7) Broad indemnity (you take most legal risk)

You must:

  • Defend and pay legal costs if issues arise [Walker | PDF]
  • Cover damages caused by:
    • Incorrect info
    • Failure to disclose
    • Property condition issues

👉 This shifts a lot of liability onto you.

8) Broker not responsible for damage or security

  • You assume risk for:

👉 Even if strangers enter via lockbox.

9) You must route ALL buyers through broker

👉 Practical impact:

  • You lose control over negotiations and communications.

10) Irrevocable license for your photos/content

  • Broker can:
    • Use and distribute your listing photos/content indefinitely
    • Even after the listing ends [Walker | PDF]

👉 Not a deal-breaker, but permanent.

11) Showing access risk (lockbox clause)

  • You:
    • Accept risk for unauthorized entry
    • Indemnify broker unless they’re negligent [Walker | PDF]

👉 Important if you have valuables.

12) Default clause ≈ automatic commission

If you:

  • Don’t cooperate
  • Or breach any term

➡️ You can owe full commission anyway [Walker | PDF]

🟡 Moderate Concerns

MLS exposure (good, but binding)

  • MLS listing likely enabled (checked) [Walker | PDF]
  • All listing data becomes MLS property

👉 Standard, but not reversible later.

Intermediary (dual agency allowed)

👉 Risk:

  • Less negotiation transparency
  • Reduced advocacy

You must stay financially current

You represent:

👉 If incorrect → legal exposure.

🟢 Neutral / Standard

  • Mediation required before litigation
  • Attorney’s fees to prevailing party
  • Equal housing compliance
  • Disclosure requirements

(All typical for Texas contracts)

✅ Key Questions You Should Consider (Actionable)

Before signing (or if still editable), consider:

  1. Can I shorten the term to 6 months?
  2. Can I add a termination clause?
    • Example: cancel after 30 days with notice
  3. Can I reduce commission (e.g., 5% total)?
  4. Can I exclude specific buyers?
    • (family/friends list)
  5. Can I limit intermediary (dual agency)?
  6. Do I want a shorter protection period (30 days instead of 60)?

⚠️ Bottom Line

This is a standard Texas REALTOR® listing contract, but:

👉 The biggest financial risks are:

  • Owing commission without a sale closing
  • Being locked in for 12 months
  • Liability + indemnity heavily favoring the broker

If you want, I can mark this up with recommended edits you could ask your agent to change before signing.

Sources

Provide your feedback on BizChat

You said:

yes please

Copilot said:

Copilot

Here are specific edits / negotiation points you can give your agent (or request in writing)—worded so you can actually use them. I’ll flag each as HIGH priority (money/risk) vs optional improvement.

🔴 HIGH‑PRIORITY CHANGES (Strongly Recommend)

1) Shorten the listing term

Current: ~12 months [Walker | PDF]

Request:

>

📌 Why:
Long lock-in reduces your leverage if the agent underperforms.

2) Add a unilateral termination clause

Not currently included

Add under Special Provisions (Section 15):

>

📌 Why:
Without this, you’re stuck unless the broker agrees to release you.

3) Limit commission to CLOSED sale only

Current: Commission earned even without closing [Walker | PDF]

Replace with:

>

📌 Why:
Avoid paying commission if:

  • Buyer backs out
  • You decline an offer
  • A deal falls through

4) Reduce or cap commission

Current: 6% total (3% + 3%) [Walker | PDF]

✅ Options:

  • Ask for 5% total
  • Or:

>

📌 Why:
You shouldn’t pay full buyer-agent commission if there isn’t one.

5) Add “named parties exclusion”

Not present (critical)

✅ Add:

>

📌 Why:
Protects you if:

  • Family
  • Friends
  • Private buyers purchase the property.

6) Shorten protection period

Current: 60 days [Walker | PDF]

✅ Change to:

>

📌 Why:
Limits how long you’re tied to paying commission after contract ends.

7) Limit buyer default payout

Current: Broker gets up to 50% of damages/earnest money [Walker | PDF]

✅ Replace with:

>

📌 Why:
That money should compensate YOU for lost time and risk.

🟠 IMPORTANT RISK REDUCTIONS

8) Reduce your indemnity exposure

Current: You broadly indemnify broker [Walker | PDF]

✅ Edit to:

>

📌 Why:
Right now, you’re covering almost everything.

9) Add showing/lockbox protections

Current: You assume risk for theft/damage [Walker | PDF]

✅ Add:

>

📌 Why:
Adds accountability for who enters your home.

10) Limit intermediary (dual agency)

Currently allowed [Walker | PDF]

✅ Option A (strict):

>

✅ Option B (middle ground):

>

📌 Why:
Avoids conflict of interest.

11) Allow direct communication

Current: You must route buyers through broker [Walker | PDF]

✅ Modify:

>

📌 Why:
Gives you visibility and control.

🟡 OPTIONAL IMPROVEMENTS

12) Limit marketing rights after contract ends

Current: Broker keeps rights to your listing content forever [Walker | PDF]

✅ Add:

>

13) Require performance expectations

✅ Add:

>

14) Require approval for pricing reductions

✅ Add:

>

(Usually implied, but good to make explicit.)

✅ CLEAN SUMMARY (What I’d push hardest)

If you only negotiate a few things, prioritize:

  1. ✅ Termination clause
  2. ✅ Commission only at closing
  3. ✅ Shorter listing term (6 months)
  4. ✅ Lower commission or adjusted structure
  5. ✅ Named buyer exclusions
  6. ✅ Reduce protection period

⚠️ Final Thought

This contract is standard Texas Realtor form, but:

  • It is written heavily in the broker’s favor
  • Almost everything you change must go into Section 15 (Special Provisions)

✅ If you want, I can:

  • Rewrite a clean “ready-to-paste” Section 15 with all recommended protections combined
  • Or help you prioritize what this specific agent is most likely to agree to based on market norms in San Antonio right now

Sources

Provide your feedback on BizChat

Drop your files here

.....

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u/CiscoLupe — 8 days ago

Update. Realtor #3 just messaged back (20 minutes after i texted her. wants to chat today. told her I'd be ready in about 30 minutes)

Update
At about 7:30 AM this morning, I sent a text to #3. About 1 minute later, #2 messaged me (responding to the message I sent him Sunday morning). He wants to set up a phone consult tomorrow (which we set up).
#3 has not responded to my text (but it's only been about 10 minutes)
.....
Original post
I had my list of realtors narrowed down to 3 people.

  1. Neighbor recommend. Lots of 5 star reviews on zillow, etc.. Met her in person and seemed helpful and nice. I emailed her to tell her I was about ready to get started and haven't heard back in 2 weeks.
  2. Recommended by 2 coworkers. I found two bad reviews. Rest were all 5s. I messaged him on Sunday morning. As of very early Monday morning, have not heard back.
  3. I met at an open house in my subdivision. And she also lives in my subdivision (maybe 1 mile from my house). The house for sale had nothing special and nothing was updated yet it sold very quickly. She mentioned that she could help clients sell without them having to do much to the house. She seemed easy to talk to and was not pushy.

When I tried to research her online, all I can find is her profile. I can't find any ratings - good nor bad.

I like the fact that she lives in my subdivision but wondering how much weight that fact should be factored into my consideration? Since I haven't heard back from the other two, should this realtor move up to #1 or do I need to start creating another list?

Edit to add: I'm selling and don't plan on getting another property in my current state

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u/CiscoLupe — 10 days ago

Century 21 realtor. These awards are listed on his page. He has been a realtor for about 15 years.

Awards

2025 Masters Emerald

2024 Quality Service Producer

2023 Masters Ruby

2022 Masters Emerald

He was recommened by 2 coworkers who have used him.
I've spoken to several realtors and narrowed my list down to 3. Number one on my list has not returned my email so he is currently #1.

Thanks

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u/CiscoLupe — 11 days ago

My kitchen/dining room/laundry cubby has original builder's flooring. I guess it's linoleum. It's cheap, whatever it is. It appears to be one continuous piece.

Getting ready to sell the property and I have a couple of tears.
https://photos.app.goo.gl/n1M3KcZZYdvR5YAC9
I don't suppose this can be reparied?

What are my cheap options? replace just the kitchen and put transisitons to the dining room and laundry room so I won't need to replace that area as well? Put stick on tiles on top of the old linoleum?

I haven't picked a realtor yet. I've had two here and they both said I didn't need to fix anything. But I'm pretty sure they didn't see the tears. I only found them when clearing a path for oven install.

I'm in south texas in a buyer's market

Edit to add: house was built in 2005

u/CiscoLupe — 13 days ago

Edit. thanks everyone. didnt know it was bad for the tree. so how does that work with rocks and or mulch that I see other people use? or how do you prevent weed eater blight if you don't have something around the tree?

Note. I've been doing it for years and don't plan to stop (unless there is a good reason I'm not aware of).

A person who was helping me in the yard said putting the leaves around the tree adds to clutter. In my opinion, leaves belong under the tree and not in a landfill, but since I'm hoping to sell my house soon, was wondering if potential buyers would be turned off. I still plan to do it though. I was just going to put some mulch on top to keep the leaves in place when the wind blows. he disagreed with that as well.

Anyway, here is a pic. I took it this morning after heavy rain and winds so some grass is poking out. When we had the discussion, there was no edging and I don't think any grass was visible.

https://photos.app.goo.gl/1uDabs5bQNPCCAzu8

P.S. i've seen people do this with pine needle and it looked pretty nice to me.

P.S.S I've als placed lawn clipping there. They biodegrade very quickly

u/CiscoLupe — 13 days ago