Co-Broking ProceduresDeborah Cumming

April 2012

What is co-broking?•Co-operation between two companies•Listing broker and selling broker•Commission is typically split•Two sides to the commission (listing and selling)

Types of Listings…

•Open Listings

•Multiple Listings (Exclusive Right of Sale)

OPEN LISTINGSCo-broking Disadvantages…

•Multiple listing agents•Competing with the owner•No control on the listing or selling process•Creates competition, rather than co-operation•No guarantee of commission•No standard documentation

OPEN LISTINGSCo-broking Disadvantages…

•Not recommended for co-broking•Co-broke letter required

MULTIPLE LISTINGSCo-broking Benefits…

•Real estate firms are able to sell each other’s listings•Quicker sale•Vendor representation•Buyer representation•No dual agency

MULTIPLE LISTINGSCo-broking Benefits…

•Maximum exposure•Best price•Guaranteed commission (contractual arrangement)•Automatic co-operation•Standard documentation•Established commission

Who does what?•Listing Broker

Represents the vendor exclusivelyEstablishes commissionMarkets the propertyArranges viewing appointmentsPrepare offers (completes documentation)Present ALL offers and counter offers to vendor

Who does what?•Listing Broker

Send information to vendor’s attorney (carriage of sale)Oversees the SALE processUpdates sale process on websiteIf offer is rejected, signed rejected offer MUST be returned to selling broker

Who does what?•Selling/Co-operating Broker

Represents purchaserPre-qualifies the purchaserIntroduces property to purchaserObtain relevant information for offerArrange earnest depositKeep purchaser informed

Who does what?•Selling/Co-operating Broker

Buyer to sign offerSend accepted offer to purchaser’s attorney

Standard Documentation…NameTRNAdAddressCompany, Occupation and TitlePurchase Price (Offer)Payment Terms

Standard Documentation…Deposit (at least 15% of Sale Price)Earnest Deposit (at least 10% of Deposit)ConditionsCompletionPossessionPurchaser’s Attorney

Incorrect Documentation…

Correct Documentation…

YOUR BUSINESSCo-Broking Benefits

•Co-operation and effective communication between brokers•Quicker sale•Best price for vendor•Fosters good working relationships between companies•Raise the bar in the industry