Flashcards in Chapter 4 - Agency and Its Responsibilities Deck (50):
What does estoppel prohibit?
Estoppel prohibits the principal from denying that a person is his or her agent if the principal has misled another to his prejudice into believing that person is the agent.
What is ratification?
Ratification is approval (confirmation) of a transaction which has already taken place.
If the seller's agent informs the buyer that the seller will take less than the list price, the agent _________ the fiduciary duty of confidentiality to the seller.
violates the duty
The Real Estate Agency Relationship Disclosure Act is also called what? And when did it become law?
The three steps of agency disclosure are:
disclose, elect and confirm
What must include your real estate license number?
Business cards, stationary, advertising materials, websites, email and regular email.
A real estate agency disclosure form must be given to all parties when the transaction involves the sale of a ________ ________.
The seller's agent cannot keep silent about any material facts that affect the value of the property (for example, the property is in an earthquake zone or backs up to a freeway or school).
What happens if an agent does not disclose dual agency to both parties?
- not receive commission
- grounds for either party to rescind the contract
All real estate listing agreements or contracts should be in ______ and must be in _____ to assure collection of a _________.
Writing and in writing in order to collect a commission.
Define open listing.
An open listing is an authorization to sell a property. It may be given to several brokers or the property may be sold by the owner. Who sells it gets the money, including the buyer. There is usually no time limit.
Define exclusive agency listing (no commission if owner sells privately).
The exclusive agency listing is a listing providing that only one agent (the listing broker) has the right to be the only person, other than the owner, to sell the property during a specified period and earn commission. Entered into MLS.
An exclusive agency listing and exclusive right to sell listing both requires a definite ________________ ______.
Define exclusive right to sell listing (commission if sold within the listing period).
Most common. Entitles the listing broker named int he agency contract to a commission even if the owner sells the property.
If a seller signs a 90 day exclusive right to sell listing with one broker, cancels it two weeks later, and gives an open listing to another broker who brings in an offer that is accepted, both brokers are entitled to a full commission.
Define net listing (must be used with other listing -- seldom used).
A net listing is an agreement providing that the agent agrees to sell the owner's property for a set minimum price, any amount over the minim being retained by the agent as commission.
Option listing (broker has a reserved right to buy).
Listing broker has the right to purchase the property. A broker with an option listing must disclose to prospective buyers that he/she is acting int he dual role of agent and principal, and present all offers to the seller.
What is the MLS?
MLS is an association of real estate brokers that provides a pooling of listings, recent sales, and the sharing of commissions on a specified basis.
A "________ ________" is the unethical practice os not giving a new listing to the MLS until the listing broker first tries toe ell that listed property through only the other agents within the company.
A _____ is a licensed broker or salesperson upon whom some of the powers of an agent have been conferred, no thy the principal, but by the agent with the principal's authorization.
subagent; the subagency can only be created with the principal's consent
Typically, a cooperating broker, like the listing broker, represents the _____ rather than the _______, which is often a big surprise to the buyer.
seller, rather than the buyer
Agreements such as between a cooperating buyer and a broker/salesperson must be in ______.
What are "comps?"
Comps are the recent sales prices of similar properties in a neighborhood. Aka the "recent selling prices."
A broker/agent can pay a _______ _____ to an unlicensed individual only for introducing a client to the broker/agent.
A listing fo ra residential building containing 1-4 dwelling units must include a notice that the commission is _______.
A 1984 California Court of Appeals division in the case of _______ v. _________ greatly extended the liability of brokers engaged in real estate sales.
Easton v. Strassburger
The Real Estate _______ _______ __________ (TDS) identifies items of value attached to the structure or land and states whether these items are operational. Sellers of 1-4 unit dwellings MUST provide this to prospective buyers.
Real Estate Transfer Disclosure Statement; also includes any additional disclosures at all regarding the material property. Otherwise, buyer has 2 years to sue.
In an "auction without reserve," the auctioneer sets a minimum bid to begin an auction. If someone offers to buy at ____% more tan the opening bid, this bid must be accepted, as an auctioneer is required to accept bids in an auction without reserve.
A broker can keep $_____ of his/her personal funds in a trust account without being guilty of commingling.
What is the unlawful misappropriation and use of a client's funds by a licensee?
How long do you keep the transaction file for?
Most real estate licensees are considered independent contractors under _____ _______ Tax Laws, but according to California Real Estate Law, and the Real Estate Commissioner, they are considered _________ of the broker.
Federal Income Tax Law
employees of the broker
Licenses do NOT have to be displayed, but must be kept at the _________ ________'s main office.
Broker-salesperson contracts must be in writing. This contract IS/IS NOT required to be approved by the DRE.
When salesperson leaves a broker, they have ___ days to tell DRE.
When salesperson joins a broker, they have ___ days to tell DRE.
10 days and 5 days.
General power of attorney --> attorney in fact.
Allows the person so authorized to perform any act the principal could perform. Specific powers conferred must be written, duly acknowledged and recorded with the county recorder's office. Death of either revokes the power.
Define special power of attorney
Only a specific act. The attorney in fact, under a special power of attorney has the authorization to perform only a specific act. Such as a listing agreement for the listing agent.
What is a tort?
A tort is any civil injury or wrong committed upon a person or that person's property.
"Puffing" is a statement of ________ that exaggerates a property's benefits. It would only be a misrepresentation if a reasonable person would consider it a statement of fact.
_________ Misrepresentations are false statements that are not known to be false at the time they are made.
_________ Misrepresentations are false statements believed to be true, but made without reasonable grounds for that belief.
________ Misrepresentations are statements made at a time when the broker knows the statement to be false, or statements in which the broker fails to disclose (conceals) material facts.
True or False?
An unlicensed person may make a secret profit on the purchase of real property, but an agent may not.
The prosecution of an unlicensed salesperson acting as a licensed salesperson is handled by the ____ ____'s office.
By law, sellers, brokers and landlords have no liability for failure to disclose a prior occupant's death or its cause after ______ years.
Termination of agency relationship: operation of law.
Expiration of the agency (listing agreement)
Destruction of Property
Death or Incapacity Broker or Seller (listing only)
Termination: Acts of the seller or broker.
Agreement by both broker and seller.
Renouncement of listing by the broker. (Broker refuse to fulfill listing agreement, can be subject to breach of contract.)
Revocation of listing by the seller (seller refusing to sell, but still owes commission).
Close of escrow.
A typical agency would deb terminated by death of the principal, destruction of the subject property, or mutual con set of the principal and his/her agent. It would not be terminated by _______.
A "________ _______" is the dollar a broker receives after all salespersons' commissions have been paid.