Knoxville, TN asked in Real Estate Law for Tennessee

Q: Has a the listing agent earned his commission if buyer breaches?

Buyer and seller reached a written agreement. Financing and all other contingencies had been removed. The day before closing, buyer said he had simply changed his mind and refused to close. Property went back on the market. Had selling agent earned his fee?

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1 Lawyer Answer
T. Augustus Claus
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A: Typically, the terms of the listing agreement between the seller and the agent dictate when a commission is earned. Many listing agreements state that a commission is earned if the agent produces a ready, willing, and able buyer, even if the sale doesn't close due to no fault of the agent. If the buyer breaches the contract without a valid reason, the agent might still be entitled to their commission. However, you'd need to review the specific terms of the listing agreement to determine this.

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