Agency & Federal Law

Question 1

Agent

Answer 1

Anyone who represents the interests off another

Question 2

Salesperson/Broker salesperson

Answer 2

A person who has a valid real estate license. A real estate licensee can generally be a salesperson or broker, active or inactive, or an individual, corporation or partnership.

Question 3

Licensee

Answer 3

Salesperson or broker-salesperson representing their employing broker’s client

Question 4

Subagent

Answer 4

Someone authorized by the principal to work for or assist the primary agent

Not practiced in NV

Question 5

Subagent broker

Answer 5

Broker from another firm who represents the listing broker’s client

Question 6

Subagent salesperson or broker-salesperson

Answer 6

Relationship to their broker’s client

Question 7

Broker

Answer 7

Someone acting as an intermediary between parties in a transaction

Question 8

Listing agent

Answer 8

Someone contracted by a property owner to find buyers or tenants

Question 9

Buyer’s agent

Answer 9

Licensed agent who represents the buyer of real property

Question 10

Single agent

Answer 10

Represents either the buy or the the seller NEVER both

Question 11

Dual agent

Answer 11

Agent represents both buyer and seller

Question 12

Special agent/Limited agent

Answer 12

Agent that performs one act or series of acts for one specific purpose on behalf of the principal

Question 13

General agent

Answer 13

Authorized to perform a wide variety of acts for the principal that are continuous in nature

Question 14

Universal agent

Answer 14

Authorized to do all types of transactions on behalf of the client

Question 15

Third party/customer

Answer 15

Someone who talks about buying, selling, or exchanging real estate with any agent

Question 16

Client/principal

Answer 16

Someone who signs an agency contract or the Duties Owed form with any licensed agent

Question 17

Care/”Reasonable care”

Answer 17

Agent must be knowledgeable and educated in the field of real estate and be able to provide beneficial services to the client using expertise

Question 18

Confidentiality

Answer 18

Agent has duties to protect client’s interest and keep certain info confidential

Agent must disclose all material facts regarding property or the transaction to all parties

Question 19

Obedience

Answer 19

Agent must act in “good faith”

Agent’s actions must reflect good and honest intention in “obeying” instructions of the principal within the limits of the law

Question 20

Accounting

Answer 20

Agent must keep accurate records of all funds exchanged from or to the principal ad disclose to the principal any compensation received from the transaction

Question 21

Loyalty

Answer 21

Agent has duties to serve the clients interest and put the client’s interest above that of the agent’s

Question 22

Diligence

Answer 22

Agent should conduct all responsibilities and tasks in a timely and professional manner

Agent should “exercise reasonable skill and care” in handling the business matters with the client

Question 23

Disclosure

Answer 23

Agent must disclose any relevant information and provide any material fact to the client whether the information is favorable or unfavorable

Question 24

Agency

Answer 24

Relationship developed between the principal and the broker

Question 25

Expressed agency

Answer 25

Created when broker and client enter into a contract with formal agreement

Question 26

Agency by ratification

Answer 26

Created when agent acts without authority, and the principal confirms the agent's actions after the fact

Question 27

Agency coupled with an interest

Answer 27

Formed when agent has an interest in the property

Question 28

Implied agency

Answer 28

May be formed even though the parties did not enter into a formal agreement Most common between agents and buyers

Question 29

How is implied agency formed?

Answer 29

Ostensible Estoppel Necessity

Question 30

Ostensible agency

Answer 30

Formed when the actions of the agent lead someone to belie the agent is the representing agent

Question 31

Estoppel

Answer 31

Once a third party believes the broker is an authorized agent, and the owner of the property does not take any action to deny it, the broker and the owner form an implied agency

Question 32

Agency by necessity

Answer 32

Forms when an unforeseen event demands an immediate action in order to prevent destruction of property

Question 33

Listing contract

Answer 33

Personal contract of employment between the seller and the broker

Question 34

4 types of listing contracts

Answer 34

Exclusive right to sell Exclusive agency Open listing Net listing

Question 35

Exclusive right to sell

Answer 35

Appoints only one broker to represent the seller If the owner finds the buyer, the broker still gets commission

Question 36

Exclusive agency

Answer 36

Agreement to contract only one broker, BUT if the owner sells the property without the broker, the broker does not receive any commission

Question 37

Open listing

Answer 37

Non exclusive listing | When more than one broker is employed to sell a property and commission is paid to the broker with procuring cause

Question 38

Net listing

Answer 38

Flexible amount of commission

Question 39

Sherman Antitrust Act

Answer 39

Brokerage firms and local real estate boards cannot set fixed commission rates Commission rates are always negotiable between broker and client

Question 40

Procuring cause

Answer 40

The reason the property sold

Question 41

Protection clause

Answer 41

Clause in listing agreements that says the broker is entitled to commission if the property sells to someone who only looked at it during the listing period but buys it after the listing expires

Question 42

Puffing

Answer 42

Way of marketing by exaggerating facts

Question 43

Parole Evidence Rule

Answer 43

Says that only a written contract is valid and anything else made orally is not valid

Question 44

REALTORS

Answer 44

members of the National Association of REALTORS (NAR)

Question 45

Multiple Listing Service (MLS)

Answer 45

Listing service provided by the board of REALTORS.

Question 46

Option

Answer 46

An agreement for the seller to give the buyer the right to buy the property within a certain period of time

Question 47

Installment contract/land contract/contract for deed

Answer 47

An agreement in which the vendor takes mostly payments from the vendee for a period of time and at the end of the term legal title is given to the vendee

Question 48

Offer

Answer 48

A gesture to show the willingness to enter into a contract ad fulfill certain promises

Question 49

Earnest money

Answer 49

Cash deposit made by the buyer when making an offer

Question 50

Meeting of the minds (M&M)

Answer 50

Agreement between parties to enter into a contract, acknowledging and accepting the terms of the contract