Agency
What is a 'net listing' and why is it prohibited in Illinois?
AA listing where the seller receives a net price after deducting expenses; legal in Illinois
BA listing where the agent's compensation is all proceeds above a specified price; discouraged as it creates a conflict of interest✓ Correct
CA listing without a specified list price; legal only for commercial properties
DA listing agreement that does not include personal property; required in Illinois
Explanation
A net listing is an arrangement where the seller specifies a minimum net price and the agent keeps everything above that amount as compensation. This creates a serious conflict of interest because the agent profits by getting the highest possible price above the net. Net listings are discouraged under the Illinois Real Estate License Act because they lead to abuses and harm consumer interests.
Related Illinois Agency Questions
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- A 'net listing' in Illinois is problematic because:
- In Illinois, what is the concept of 'undisclosed dual agency' and why is it prohibited?
- What is the primary difference between an exclusive right-to-sell listing and an exclusive agency listing in Illinois?
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