The most important difference between a limited service (usually flat fee MLS) listing and a traditional “Exclusive Right of Sale" listing is that with Exclusive Right of Sale, buyers’ agents cannot go directly to the seller and discuss terms of an offer. Then why does this happen on a regular basis?
I believe it is because some agents get carried away and forget that it is a clear ethics violation and on top of that little break in the chain of command, it is a remarkably stupid negotiation strategy.
These unethical renegade agents, in essence, are attempting to pre-negotiate an offer with a represented seller. When a seller is self-represented, as they would be if they did a flat fee MLS listing with a discount broker, this would of course be perfectly kosher. But when a seller has hired an agent, this practice is unethical and can hurt negotiations.
For example, if a buyer’s agent asks a seller if they would consider an offer at “x” price or particular terms, the seller could say, “no, I want full price.” The point is when speaking directly with the person that can both make a final decision and has the power to do so, the one asking the question is no longer in a position to negotiate. At best, they have degraded their buyer’s chances of getting the best deal possible.
What is causing a Realtor to dismiss ethical practices and circumvent the listing agent is a mystery. One might theorize that they have experienced negotiating with flat rate MLS listing sellers and have gotten used to this strategy and forget that it’s not permitted with a full service listing. Either way, perhaps this is something that needs to be addressed more in the Realtor education system.