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Managing Broker > GENERAL PRINCIPLES OF AGENCY > Flashcards

GENERAL PRINCIPLES OF AGENCY Flashcards

1
Q

Exchanging like-kind property for like-kind property, resulting in a deferral of capital gains tax; also called a tax-free exchange

A

1031 EXCHANGE

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2
Q

A client level duty relating to account of earnest money, actions, etc.

A

ACCOUNTING

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3
Q

A customer level duty relating to disclosure of all material defects (including latent or hidden defects) to any customer; e.g., leaky roofs, leaky basements, etc.

A

ACCURATE

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4
Q

One who is hired to represent another

A

AGENT

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5
Q

A total transfer of rights in a lease where the original tenant and new tenant are both liable to the landlord for the lease payments

A

ASSIGNMENT OF LEASE

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6
Q

The title given to someone who has the power of attorney; can sign on others behalf

A

ATTORNEY-IN-FACT

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7
Q

Where a party to a contract does not perform according to the terms of the agreement

A

BREACH

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8
Q

Profit made on an investment item, such as real estate

A

CAPITAL GAIN

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9
Q

A client level duty exercising knowledge and skill

A

CARE

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10
Q

A client level duty relating to maintaining confidential information of the client

A

CONFIDENTIALITY

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11
Q

In leasing, a situation where the landlord constructively evicts the tenant by not maintaining the premises; e.g., no heat in the wintertime; lessee or tenant must actually leave the premises and is released from lease obligations

A

CONSTRUCTIVE EVICTION

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12
Q

A client level duty relating to disclosing to a client all materials facts regarding the transaction

A

DISCLOSURE

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13
Q

A situation where a broker represents both buyer and seller at the same time; must have written prior permission from both parties and informed consent

A

DUAL AGENCY

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14
Q

Liability insurance for real estate agents that protects against claims of failure to perform duties or mistakes being made

A

ERRORS AND OMISSIONS INSURANCE

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15
Q

A lease clause allowing a landlord to pass increased costs along to tenant; i.e., can raise rent to tenant if landlord`s costs go up

A

ESCALATION CLAUSE

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16
Q

Only for owner-occupied properties; a person can write off up to $250,000 of capital gains if single, $500,000 if married; must have been your personal residence for 2 of the past 5 years; can use exclusion repeatedly, not just once in a lifetime

A

EXCLUSION ON HOMES

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17
Q

A type of listing where the owner and one broker are authorized to sell and receive a commission

A

EXCLUSIVE AGENCY LISTING

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18
Q

A type of listing where only one broker is authorized to sell and receive a commission

A

EXCLUSIVE RIGHT TO SELL LISTING

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19
Q

Refers to a contractual obligation where all parties have clearly stated their intentions

A

EXPRESSED

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20
Q

A customer level duty relating to treating all customers fairly

A

FAIR

21
Q

Loyalty and trust; what an agent owes to a principal (client)

A

FIDUCIARY

22
Q

A person who represents someone else in several areas on an ongoing basis; e.g., property manager to owner; also salesperson to broker

A

GENERAL AGENT

23
Q

Insurance a real estate brokerage can obtain to protect against someone being harmed or injured on the brokerage premises

A

GENERAL LIABILITY INSURANCE

24
Q

A lease where the payments can go up or down, but are pre-determined

A

GRADUATED LEASE

25
Q

A lease where the landlord pays taxes, assessments, insurance, etc.

A

GROSS LEASE

26
Q

A lease for ground; usually long-term; e.g., farmers, gas stations, etc.

A

GROUND LEASE

27
Q

Insurance a real estate brokerage can obtain on business property to protect against vandalism

A

HAZARD INSURANCE

28
Q

A customer level duty relating to being honest with customers

A

HONEST

29
Q

Refers to a contractual obligation that is created by one`s actions

A

IMPLIED

30
Q

A lease where the payments can go up or down but are based on some type of index, such as the consumer price index

A

INDEX LEASE

31
Q

(Fiduciary) A client level duty relating to doing what is in your client`s best interest

A

LOYALTY

32
Q

A lease where the tenant pays all or part of taxes, assessments, insurance, etc. Taxes paid by tenant would be tax deductible for the tenant.

A

NET LEASE

33
Q

Normally illegal; this is where the real estate commission is the sale price less the seller`s required proceeds

A

NET LISTING

34
Q

A clause in a lease and lending document allowing for continuation of a lease even if the property is foreclosed on

A

NON-DISTURBANCE CLAUSE

35
Q

(Performance) A client level duty following instructions of a client

A

OBEDIENCE

36
Q

A type of listing where everyone is authorized to sell and receive commission, including the owner; the only one who gets paid is the one who is the procuring cause (found the buyer)

A

OPEN LISTING

37
Q

Costs incurred in a property management situation, such as utilities and repairs; does not include vacancies

A

OPERATING COSTS

38
Q

Refers to a contractual obligation that is created by what appears to be; similar to implied

A

OSTENSIBLE

39
Q

A lease where the rent is based on a percentage of sales; normally used in retail leases

A

PERCENTAGE LEASE

40
Q

A written document authorizing one to sign legal documents on behalf of another

A

POWER OF ATTORNEY

41
Q

One who hires an agent for representation

A

PRINCIPAL / CLIENT

42
Q

An agreement between an owner and property manager that shows basic duties of the property manager; generally this agreement does not contain a vacancy rate

A

PROPERTY MANAGEMENT AGREEMENT

43
Q

Protects broker in case negotiations extend past the expiration date of listing; this clause is normally standard in an agency agreement

A

PROTECTIVE PERIOD CLAUSE

44
Q

A federal law that prohibits groups of brokers setting a fixed price for services

A

SHERMAN ANTI-TRUST LAWS

45
Q

A person who represents someone else one time in one area; e.g., broker to seller

A

SPECIAL AGENT

46
Q

An agency situation where one agent is authorized to use another agent to represent the client; historically, this is where two brokers, the listing and selling broker, both represent the seller; buyer is a customer and is unrepresented

A

SUB-AGENCY

47
Q

A partial transfer of rights in a lease where just the original tenant remains liable for the lease payments; the new tenant is a lessee of the original tenant

A

SUBLEASING

48
Q

Exchanging like-kind property for like-kind property, resulting in a deferral of capital gains tax; also called a 1031 exchange

A

TAX-FREE EXCHANGE

Managing Broker (10 decks)

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