Real Estate Agency

Question 1

What is Agency?

Answer 1

When you are authorized to act on someone else’s behalf

Question 2

What is Principle?

Answer 2

person hiring an agent
ex. seller buyer, landlord, investor, broker

Question 3

Agent

Answer 3

Person hired to represent the principle

Question 4

Universal Agent

Answer 4

may represent the principle on ANY matter

Question 5

General Agent

Answer 5

may represent the principle on matters related to ones particular business

Question 6

Special Agent

Answer 6

may represent principle on specific matter or transaction

ex. employing broker

Question 7

subagent

Answer 7

the agent’s agent; represents the principal on behalf of the agent

Question 8

Express Agent

Answer 8

explicitly stated verbally or in writing

Question 9

Implied Agency

Answer 9

Authority exsts because of principal and agents actions (never directly stated)
*Equal Dignities Rule - Authorization of agency must have the same formality

Question 10

Apparent/Ostensible Agency

Answer 10

Authority does NOT exist - even though it appears to

Question 11

“O.L.D. C.A.R.”

Fiduciary Obligations

Answer 11

Obedience
Loyalty
Disclosure
Confidentiality
Account
Reasonable care

Question 12

Implied Duty of Good Faith

Answer 12

MA law requires brokers to engage in fair and honest dealing

people you represent must give OLD CAR

Question 13

Disclosure and Confidentiality 1.

Answer 13

Must disclose
- material defects
- anything that would impact a buyers decision to purchase
*ex. water damage,lead paint, mold, flood zone, new buiding construction

Question 14

Disclosure and Confidentiality 2.

Answer 14

Must not disclose
- anything that wont materially impact the property or ability to conduct transaction
*ex. how low seller is willing to go in price, how desperate the sellers are to sell or the buyers are to buy, divorce situation, financial situation

Question 15

When something might have to be disclosed

Answer 15

can differ depending on the state of law

Question 16

Might have to disclose (Stigmatized Properties)

Answer 16

Property that was the site of deaths, murders, suicides, criminal activity, paranormal activity..
In MA: if a buyer/buyers agent asks, then the listing agent must disclose what they know

In MA: if buyer/buyers agent asks, then the listing agent must disclose

Question 17

Megans Law & Sex Offender Registry

Answer 17

• Each state handles disclosure of sex offenders differently
• in MA, it’s strictly forbidden to misuse or misrepresent the contents on the registry
• Direct clients to the registry so they can do the research themselves

NEVER represent the contents on the registry