Practice Quiz 3 Flashcards
Natural Hazard Disclosure (NHD)
A report provided by a local agency or NHD vendor and used by sellers and seller’s agents to disclose natural hazards which exist on a property held out for sale.
Negative Fraud
Deceitfully withholding or failing to disclose information to someone.
Guarantee
A statement by an agent concerning an event or condition which has not yet occurred based on readily available facts.
Financial Services Representatives (FSRs)
Bona fide employees of brokers who generate business for their employing broker.
Implied Promise
The presumption that a buyer or seller entering into an agreement will in good faith fulfill their obligation to close the transaction.
Third Party Beneficiary
A person for whose benefit two other persons place a provision in an agreement, such as a provision for payment of broker fees.
Projection
An opinion about an income property’s future performance based on its performance during the preceding 12-month period, adjusted for presently known trends.
Transfer Disclosure Statement (TDS)
A mandatory disclosure prepared by a seller and given to prospective buyers setting forth any property defects known or suspected to exist by the seller, generically called a condition of property disclosure. (See RPI Form 304)
Best Effort obligation
Obligations under an open listing requiring the agent to take reasonable steps to achieve the objective of the client but requiring no affirmative action until match is located at which point due diligence is required.
Material Fact
Information about a listed property which may affect the property’s value or alter a client’s decision to purchase or sell the property and, thus, needs to be disclosed.
Multiple Listing Service (MLS)
A subscription available to real estate brokers which pools preliminary information on property listings for publication.
Preliminary Title Report (Prelim)
A report constituting a revocable offer by a title insurer to issue a policy of title insurance used by a buyer and escrow for initial review of the vesting encumbrances recorded and currently affecting title to a property.
Estimate
Prediction of future amounts which have not yet actually occurred.
Finder’s Fee
Forecast
Seller’s Net Sheet
A document prepared by a seller’s agent to disclose the financial consequences of a sale when setting the listing price and on acceptance of a buyer’s price in a purchase offer. (See RPI Form 310)
Fee-Splitting
When fees made to a broker are split vertically with employed agents or split horizontally among other brokers.
Referral Fee
A fee paid illegally by one service provider to another, both rendering services in a real estate transaction, in exchange for the referral of a principal when the buyer’s mortgage financing subjects the transaction to RESPA Regulation X rules.
Real Estate Settlement Procedures Act (RESPA)
A federal law promoting lender transparency in their mortgage origination process to protect consumers from kickbacks and uncompetitive or duplicated fees. RESPA rules are implemented through Regulation X.
Fiduciary Duty
The duty owed by an agent to act in the highest good faith toward their client and not to obtain any advantage over the client by the slightest misrepresentation, concealment, duress or undue influence.
Marketing Package
A property information package handed to prospective buyers containing all the disclosures compiled by the seller’s agent on the listed property.
Contingency Fee Provision
A provision in purchase agreements and escrow instructions calling for a specific event to occur or act to be performed before the broker’s fee is payable. (See RPI Form 150)
Fact
An existing condition which is presently known or readily knowable by the agent.
Affirmative Fraud
Intentionally and knowingly misrepresenting information to someone.
Finder
An individual who solicits, identifies and refers potential clients to brokers, agents or principals in exchange for the promise of a fee. (See RPI Form 115)
