Great Lakes Wire

Michigan Attorney General Dana Nessel signed Senate Bill 602 into law today while serving as acting governor. Nessel was accompanied by members of the Michigan Realtors, representatives of the Department of Attorney General, and her son.

The legislation, sponsored by state Senator Kevin Hertel, amends the Occupational Code to specify conditions under which a right-to-list home sale agreement between a residential property owner and a real estate broker would be void and unenforceable.

“Senate Bill 602 strengthens protections for homeowners by prohibiting unfair practices in real estate transactions,” Nessel said. “Many homeowners have faced predatory right-to-list agreements that lock them into unfavorable terms. This legislation provides much-needed clarity and protects both property owners and real estate professionals. I am honored to have the opportunity to sign this legislation into law.”

“Selling a home is never an easy thing to do, and when realtors engage in predatory practices, it becomes even more difficult,” said Senator Hertel. “Michigan property owners deserve the ability to make informed decisions about a monumental life event without fear of coercion or deception. This legislation will help us achieve this by curbing exploitative right-to-list home sale agreements and putting the best interests of homeowners at the forefront.”

A right-to-list home sale agreement is 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. Senate Bill 602 indicates that such an agreement would be void and unenforceable in several instances, including if any of the following apply:

- 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; or

- It does not include an option for the owner to terminate the agreement as specified in the new law.

The new law subjects real estate brokers who enter into void and unenforceable agreements to penalties, including license revocation, administrative fines up to $10,000, restitution, and probation.

The Michigan Constitution allows the Attorney General to act as governor with authority to sign legislation if the governor, lieutenant governor, and secretary of state are away from the State.

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