A Contract Owner is a buyer with a binding contract where the current owner of record grants permission to the Contract Buyer to list the property for sale and advertise the property prior to the closing of title.
In order to list such a property on the SmartMLS, we require the attached form be completed and uploaded as a Private- Misc. supplement. In addition, the words contract owner must be entered following the seller’s name and the Remarks must state ‘sale dependent upon the contract owner’s ability to take title’. As long as these two stipulations are met, the property can be listed as New even though the existing listing for the property has not yet closed.
Scenario: Kathy agrees to purchase Sonni's property at 123 Main St. The sale of the property is not yet closed (Sonni isn't ready to close, for whatever reason), but Kathy is now considered to be the contract owner of 123 Main St.* Kathy is a flipper, and she does not want to wait until the sale closes before putting the property back on the market for sale/rent, so she contacts her favorite broker, Jacquie, to list the property on the MLS.
* It is incumbent on Sonni (as the seller of 123 Main St.) to have a provision in her contract with Kathy (the contract owner) that allows Kathy to list 123 Main St. concurrently with the existing listing, even though that sale has not yet been finalized. This is a contractual issue and not something within the jurisdiction of SmartMLS to oversee or enforce.