Contracts
Under Massachusetts law, a real estate broker's commission is earned when:
AThe listing agreement is signed
BA ready, willing, and able buyer is produced and the seller accepts (though often paid at closing)✓ Correct
CThe property closes
DThe mortgage commitment is received
Explanation
Under traditional Massachusetts agency law, a broker earns the commission when they procure a ready, willing, and able buyer on the seller's terms. However, most modern listing agreements specify that the commission is paid at closing.
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Key Terms to Know
Listing Agreement
A contract between a property owner and a real estate broker that authorizes the broker to market and sell the property.
AgencyA legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.
Purchase AgreementA legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
Earnest MoneyA deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
Math Concepts
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