Michigan Gov. Gretchen Whitmer signed legislation regarding right-to-list home sale agreements.
The new law, SB 602, makes a right-to-list home sale agreement void and unenforceable if any of the following apply to the agreement:
- It is not in writing.
- It is not signed by all persons that have an ownership interest in the residential real estate considered in the agreement.
- It is for a period of more than two years.
- It does not include both an option for the owner to terminate the agreement before its expiration date for an amount of consideration payable to the real estate broker that is not more than the initial consideration the broker paid to the owner with interest of 6 percent per annum that starts from the date the broker provided the initial consideration through the date the owner terminated the agreement and the period of time that the agreement is effective and an explanation of the early termination option on the first page of the agreement in a conspicuous manner.
It applies to right-to-list home sale agreements entered into, extended or renewed on or after the effective date of the amendatory act.
It defines right-to-list home sale agreement as “an agreement between an owner of residential real estate and a real estate broker that obligates the owner to list the residential real estate for sale with the real estate broker at a future date in exchange for consideration.”
Among other things, the new law also requires “if a purchase agreement signed by a seller and purchaser provides that an escrowee other than a real estate broker shall hold a deposit, a licensee in possession of that deposit shall cause the deposit to be delivered to the named escrowee not later than two banking days after the licensee receives notice that an offer to purchase is accepted by all parties.”