Texas Crammer Practice Exam

What is true about a listing agreement with a definite expiration date?

1. The seller cannot terminate the agreement

2. The seller can get out of the listing with possible recourse

3. The broker must automatically renew the contract

4. The agreement becomes void at expiration

The correct answer is: The seller can get out of the listing with possible recourse

A listing agreement with a definite expiration date establishes a clear timeline for the broker's representation of the seller in marketing the property. The correct choice indicates that while the seller technically has the ability to terminate the agreement if they choose to do so, it may involve some form of recourse. This could include financial repercussions or obligations, such as paying a commission for any buyers introduced to the property during the listing period. The other options do not accurately reflect the nature of such agreements. The seller does have the right to terminate the agreement, hence the first option is not valid. The option suggesting that the broker must automatically renew the contract is incorrect because listings with definite expiration dates do not automatically renew; they expire as specified. Lastly, while the agreement does become void at expiration, it does not account for the possibility of termination prior to that expiration, making this option less comprehensive.