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Housing and Property

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Selling Your House

So, you’ve decided to sell your house. What should you know before you put your house on the market?

This pamphlet is the fourth in a series of pamphlets about Buying and Selling a House. Other pamphlets are entitled Planning for Buying a Home, Preparing the Offer to Purchase and Mortgages.

The purpose of this pamphlet is to suggest some things you should consider before you put your house up for sale. It does not contain a complete statement of the law in the area, and changes in the law may occur from time to time. Anyone needing specific advice on his/her own legal position should contact a lawyer.

How much should I ask for my house?

Of course you want to get the best possible price. Find out what similar houses in your area have sold for. Ask someone who knows the real estate market or have a real estate appraiser or agent to suggest a price.

How will I be paid for the house?

That depends on how you want to be paid. Consider whether you want the buyer to pay all cash. Or, if you have a mortgage on your house, will you allow the buyer to assume or take over that mortgage? Check with your lawyer to see if you would continue to be liable after the buyer took over the mortgage.

You may want to consider taking back a mortgage to help sell your property. You in effect would become the lender.

How do I find a buyer?

Do you want to try to sell the house yourself or use a real estate agent? A real estate agent can help you to judge the value of your property. The agent will also advertise and market the property for you to help you find a buyer.

When you use a real estate agent you will pay the agent a commission based on the price for which the property is sold. Commissions in New Brunswick vary and are negotiable. A real estate agent will require that you enter into a binding agreement called a listing agreement. Check with several real estate companies to find out the services offered and the commissions charged by them before signing a listing agreement.

The agent’s duty is to find a purchaser to buy the house for a certain price. If the agent finds one, generally the seller must pay the commission price even if the seller decides not to sell the house.

What is a listing agreement?

There are three types of listing agreements available: open, exclusive, and multiple.

Multiple listings (MLS)

With a MLS listing, the seller, agrees to have the house and its features distributed to all members of the local real estate board or association. This listing gives the property a lot of publicity. The fee for such broad coverage is a higher rate of commission than for other listing agreements.

If you are in a hurry, you may be able to save money if you list the property under an exclusive agreement for 30 days.

Exclusive listing

The seller agrees to list and advertise the property for sale only within the listing agent’s office or other branches of the same company. The exclusive right to sell the property is for a specific period.

Open listing

The seller agrees to pay the agent a specific rate of commission if the agent finds a buyer for the property. The agent does not have an exclusive authority over the property. You may enter into several open listing agreements with different agents.

How do I accept an offer?

The standard form of offer to purchase contains a space at the bottom for your signature. By signing, you accept the offer to purchase and must live up to the terms of that offer. The agreement of sales is binding.

See pamphlet #2 of this series (Preparing the Offer to Purchase) for more information about the details of the offer and how the seller can respond or make a counter-offer.

What role does a lawyer play?

Your lawyer can explain the meaning of the offer to purchase and tell you if the agreement is in your best interest. You are entering into a binding agreement and you should have your lawyer review the agreement before you sign.

What if I accept the offer and the buyer refuses to complete the deal?

If the offer was conditional and the conditions cannot be met then the buyer may not have to complete the deal. However, if the buyer has no valid legal reason for not completing the deal there are several legal actions that you can take. You should consult a lawyer about your rights of action.

What if I have a mortgage?

You will have to pay off all mortgages, penalties, charges, and liens against the title on or before the closing date at your own expense. Check to see if there are any penalties for paying off your mortgage early.

The general practice is for the seller’s lawyer to receive in trust the funds to pay off the mortgage on the closing date. Your lawyer will give a personal guarantee to get and register a discharge of that mortgage as soon as possible after closing.


Public Legal Education and Information Service of New Brunswick (PLEIS-NB) is a non-profit organization. Its goal is to provide New Brunswickers with information about the law.

PLEIS-NB receives funding and in-kind support from the Department of Justice Canada, the New Brunswick Law Foundation and the New Brunswick Department of Justice.

We gratefully acknowledge the cooperation of Consumer Affairs Branch, New Brunswick Department of Justice, New Brunswick Real Estate Council and members of the Law Society of New Brunswick and members of the Law Society of New Brunswick.

Published by:
PLEIS-NB
P.O. Box 6000
Fredericton, N.B.
E3B 5H1
CANADA
Tel: (506) 453-5369
Fax: (506) 462-5193
Email: pleisnb@web.ca

ISBN: 1-55048-237-8

 

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Disclaimer: Please note that our website contains general information about the law. This is not a complete statement of the law on particular topics. We try to update our publications often, but laws change frequently so it is important for you to check to make sure the information is up to date.  The information in our publications is not a substitute for legal advice. To receive legal advice about your specific situation, you need to speak to a lawyer.