REAL ESTATE SALES Flashcards
(20 cards)
A seller, in her interactions with her listing broker, would be known as a(n):
The principal who engaged the agent’s services is known as a client. Third parties, such as prospective buyers, are known as customers.
While at an open house, the listing agent encounters an unrepresented buyer. The agent is asked by the buyer to prepare an offer to purchase. At the meeting to prepare the offer, the agent tells the buyer, “I’m sure I can get the seller to agree to this price and get the financing you need.” What has the listing agent just done?
Agents must be very careful about what they say to customers. If an agent appears to be the agent of the buyer as well as the seller, they may become a dual agent.
X lists a property. X finds a buyer. Is X allowed to write an offer as a buyer’s representative?
Informed consent is required in order to have disclosed dual agency.
An agency relationship created by a listing agreement can be terminated legally without recourse under which of the following circumstances?
The listing broker is the agent of record in a listing. A listing is an employment agreement; therefore, when an employee dies, the agreement is void. This is not the salesperson’s listing; the listing belongs to the broker of record in every transaction, not to the agent.
A sales agent is selling their own personal property, the condition of which they misrepresent. The agent is sued and raises the defense that they were not acting as an agent in this sale, but rather, were selling their own property personally. The probable outcome of the case is:
Sales agents are subject to the rules of professional ethics 24 hours a day, 7 days a week, 365 days a year, whether selling property for someone else or for themselves. Agents selling their own property are not relieved of their professional or ethical responsibilities.
An agent realizes that one of the houses in their routine farm area would be a good fit for their buyer customer. The agent gets the seller to agree to pay their broker a commission if the buyer makes an acceptable offer. What kind of agency has been created if no listing agreement was entered into?
Agency by ratification : There was no listing agreement, so the relationship is created by the seller accepting the benefits of the relationship, also known as ratification.
A relationship between one person (principal) and another (agent), wherein the agent is given the right to act on behalf of the principal in a business setting, is usually called:
There is no such thing as customer representation. An agent may work with a customer (a third party), but may not lawfully work for a customer.
An agency relationship should be created by which of the following methods?
An agency agreement should be created by express written agreement. The term estoppel refers to apparent agency, which is created when a person allows an agent to appear to be the agent of that person without any actual authority. Ratification is the acceptance of an agent after the performance of the act; a real estate agent should have express authority before performing any acts for a principal. Implication is used to create an agency relationship by a party’s conduct where no express agreement exists.
A buyer broker agreement cannot be:
An exclusive buyer broker agreement is like a listing; it is a service agreement, and cannot be assigned.
During a listing interview, a seller demands that the listing agent reduce the proposed commission by 1%. What is the best course of action for the agent?
An agent should not adjust commissions without the consent of the broker. Commissions may be fixed by company policy, but are not dictated by law or even local custom - they are negotiable between the company and the client.
A real estate agent in a sales transaction is referred to as what type of agent?
A special agent is an agent with limited authority. A general agent can do anything for the principal in one particular area (i.e., managing real estate) as long as there is a written broker/client contract. A universal agent can do anything and everything for the principal (i.e., someone with a general durable power of attorney). There is no such thing as a limited agent.
A licensee who has both a listing and the option to buy must inform the principal of which of the following?
The agency relationship should have already been disclosed by this point. Advertising costs are only disclosed if the principal is paying for them. The principal must consent to the amount of profit an agent will make for the agent to exercise their option.
Which of the following persons would be responsible to her employer for results only?
An independent contractor is a person who sets her own schedule, works with little supervision, and is paid for each task accomplished, often by commission.
A licensed real estate salesperson is permitted by law to represent:
A licensed real estate salesperson works for their broker only, and acts on behalf of their broker as a sub-agent to the buyer or seller. The salesperson’s responsibility and authority come only from their broker.
Which of the following is a true statement regarding buyer agency?
A buyer’s agent represents only the buyer, not the seller or the seller’s agent. He is not liable for anything done by the seller or seller’s agent.
Which of the following is the best example of a special agent?
By definition, a special agent is one who has very limited authority and may do only one thing for the principal (i.e., find a ready, willing and able buyer). A universal agent may do anything for the principal, and a general agent is an agent who may do anything in one particular area (i.e., a property manager). There is no such thing as a limited agent.
A broker takes a listing. The seller accepts an offer from a buyer who’s being represented by a salesperson who works for the listing broker. The broker is now classified as a:
If the buyer and the seller in a transaction are both represented by the same broker, or by different salespersons affiliated with the same broker (an in-house transaction), then the broker is a dual agent. When the broker is a dual agent, any affiliated salespersons involved in the transaction are also dual agents.
A listing agent works for the seller. A buyer’s agent works for the buyer. What responsibility does a licensee have to the other agent’s party?
Whether representing a buyer or a seller, an agent may never treat the other party dishonestly or unfairly. Duties of confidentiality, obedience, and loyalty are owed to the principal and are not owed to the party the agent does not represent.
Under California workers’ compensation law, the broker is responsible for:
In regards to workers’ compensation, brokers are responsible for both clerical employees and salespeople.
One who acts for (or has the power to act for) another is termed:
An agent acts on behalf of another and owes the principal and/or client fiduciary duties. The customer is not represented by anyone.
