Cancelling a Real Estate Listing Agreement: A Step-by-Step Guide

Making a clean break from a listing agreement requires careful maneuvering and negotiation. Firing your listing agent differs from completely taking your home off of the market and usually entails different protocol. Your listing is actually with the agent's real estate firm, rather than the individual agent, and proceeding the wrong way can result in unwanted fees and even litigation. You can generally cancel a listing agreement if your agent's performance falls short of their contractual obligations, or in some cases, if you decide you don't want to sell anymore. Breaking your listing contract may also leave you owing the firm a commission.

Step 1

Read your listing agreement and determine which facets of the contract your agent failed to meet. The agent's responsibilities may be outlined in sections entitled "Duties," "Responsibilities" or something similar, and often includes tasks such as marketing and disclosing offers. If you are planning to cancel the agreement with the agent in favor of a different agent from the same real estate firm, explain this to the agent's manager or broker. This relatively easy change to the contract cancels your obligation to work with the individual agent. However, your listing agreement remains with the firm.

Step 2

Explain your reasons for cancelling the listing if you're taking your home off of the market before the listing expires. Disclose personal circumstances such as financial limitations, a job loss, illness, or other situation that prevents you from continuing with the sale. The broker may understand and agree to a mutual cancellation; however, they may also require you to cover certain expenses. Early termination fees may equal hundreds of dollars, according to Bankrate. Agents who pay for staging, professional photography and ads may also want to be reimbursed for those costs if you cancel the listing.

Step 3

Review and sign the listing cancellation document. This is a boilerplate form developed by the state's real estate commission or governing organization. Read each part of the cancellation agreement carefully and ask about any sections or clauses you don't fully understand. A cancellation agreement usually includes a clause that prevents you from re-listing the home soon after or selling the home to a buyer procured during the listing period.

Tip

You can also consult a real estate attorney or undergo arbitration if you believe the real estate agent or firm breached your listing agreement or violated real estate practice laws, leading to your cancellation.