Chapter 2: Important Points

Question 1

IP Real estate agents are

Answer 1

Special agents with specific authority

Question 2

IP The agent’s fiduciary duties and responsibilities include

Answer 2

OLD CAR
Obedience, loyalty, disclosure of information, confidentiality, accountability; and reasonable care, skill and diligence.

Question 3

IP When is a brokerage contract created?

Answer 3

When the principal, usually a real estate owner, hires a broker (agent) to perform services relating to the real estate. Every agency relationship is consensual

Question 4

IP The principal may authorize the agent to use other people to assist in accomplishing the purpose of the agency. What are these people called?

Answer 4

Subagents

Question 5

IP Agency relationship

Answer 5

Is not determined by the nature of the compensation (commission or flat fee) or who pays it.

Question 6

IP Options for an agent

Answer 6

An agent may decide to represent the seller or the buyer in the real estate transaction.

Question 7

IP Single Agent

Answer 7

An agent who works only for the buyer or seller directly and who may elect to reject subagency.

Question 8

IP Seller agent

Answer 8

Represents the owner of real property and accepts the employment contract of a listing agreement establishing a client relationship taht works in the best interests of the seller.

Question 9

IP Buyer agent

Answer 9

Represents the buyer or purchaser of real property and accepts the employment contract of a listing agreement establishing a principal or client relationship working in the best interests of the buyer or purchaser.

Question 10

IP Dual Agent

Answer 10

An agent who attempts to represent both the buyer and the seller in the same transaction. It can occur in real estate companies when the firm attempts to represent both the buyer and seller in the same transaction.

Question 11

IP MLS

Answer 11

Multiple Listing Service offers cooperation and compensation to participating members. It does not create an automatic subagency.

Question 12

IP Cooperative Sales

Answer 12

With seller agents from another real estate firm as subagents of the listing broker and seller, or with buyer agents from another real estate firm, are processed through the usual system of offerings published within MLS.

Question 13

IP Disclosure Form Requirements

Answer 13

In the sale or rental of one- to four-unit residential properties, a dual agent must have the written approval of both parties after the agent’s informed disclosure. The buyer and the seller each agree to relinquish the individual, undivided loyalty in the fiduciary relationship.

Question 14

IP Undisclosed dual agency can result in

Answer 14

A violation of New York Property Law

Question 15

IP In-House Sales

Answer 15

New York Real Estate firms can provide dual agency.

Question 16

IP Disclosure

Answer 16

All agents must disclose what party they represent in the real estate transaction.

Question 17

IP Disclosure Form 2

Answer 17

In New York in the sale of rental of one- to four-unit residential properties, the mandatory disclosure regarding real estate agency relationships form must be presented to all parties signing listing agreements and at other meetings and discussions between prospective buyers and sellers at the time of the first substantive contact or meeting.

Question 18

IP Two Agency Disclosure Forms

Answer 18

NYS Disclosure Form for Buyer and Seller

NYS Disclosure Form for Landlord and Tenant

Question 19

IP Agency Relationship

Answer 19

When one person is hired to act on behalf of another, this relationship is created. This is usually created with an agreement (express agency) but also can be implied by the agent’s conduct. A position of trust, which is a fiduciary relationship, exists between every principal and agent in this relationship.