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Law of Agency > Special Intermediary Applications > Flashcards

Flashcards in Special Intermediary Applications Deck (23):
1

What must a broker obtain before acting as an intermediary?

Written consent

2

What is a specialized real estate transaction?

Exchanges, syndications, farm sales, sale and leases of industrial and commercial properties

3

What is the number one rule that a broker must follow when working a 1031 Exchange?

Disclosure to ALL parties

4

In what situation can a broker disclose that an owner will accept a price less than the asking price?

If the owner gives the broker written authorization

5

Unintended dual agency might occur when:

The listing broker represents both buyer and seller.
A totally in-house transaction occurs.
Another broker represents the buyer and also acts as a subagent of the seller.
A written agreement is in force with one party but a verbal agreement is made with another.

6

The agent should avoid the following statements that might create an implied agency relationship:

"You can count on me to take care of all the details in the sale."
Let me see if I can get a better deal from the seller."
"This listing is overpriced. Let's offer $20,000 less."
"Trust me; I can get you the best deal."
"The seller is not going to counter your offer."

7

What is it called when an agent creates a dual agency relationship by taking on responsibilities that normally should be done by a cooperating agent?

Unintended Dual Agency

8

Define accidental dual agency.

When an agent creates a dual agency situation, but the intent was not to purposely deceive anyone.

9

What action should a client-agent take if a customer asks for advice?

Refer the customer to seek out professional assistance

10

What should a licensee do when listing his or her own property?

Licensees should always inform the broker when listing a licensed-owned property.

11

Agent Norm owns 30% of a storage unit facility. Is he required to disclose his partial ownership when listing the property for sale?

yes

12

What treatment is required when an agent is working with a FSBO?

FSBO must be treated fairly and honestly.

13

What is NAR's position on an agent selling his or her own property?

REALTORS® shall reveal their ownership or interest in writing to the purchaser or the purchaser's representative.

14

Representation of more than one party is not just limited to residential transactions.

The broker should also be familiar with dual agency issues relating to exchanges, syndications, farm sales, and leases of industrial and commercial properties. The collective noun used to identify these types of transactions is called specialized real estate transaction.

15

A specialized real estate transaction

usually involves three or more parties and a number of party representatives

16

To authorize the possibility of an intermediary relationship in a listing agreement or buyer representation agreement

Texas law requires that the agreement be in writing and disclosure is in bold print [TRELA §1101.651].

17

Under Section 1031 of the United States Internal Revenue Code

the exchange of certain types of property may defer the recognition of capital gains or losses upon sale, and hence defer any capital gains taxes otherwise due.

18

Section 1031

exchanges occur frequently in rental property sales. Due to the possibility of a large compensation, an unprofessional broker working a 1031 exchange might be tempted to compromise the interests of each party in order to culminate a deal.

19

An intermediary relationship

may be a better option for the broker to follow to maintain fairness and remain honest.

20

A real estate syndicate

is a financial services group formed temporarily for the purpose of handling a large transaction that would be difficult or impossible for an individual entity to handle. Syndication allows companies to pool their resources and share risks.

21

Undisclosed representation problems

might arise when a general partner in a real estate syndicate is also a real estate broker.

22

Accidental dual agency is illegal

and occurs when an agent is not purposely trying to deceive anyone. Like any other agency, it may occur unintentionally or inadvertently. Sometimes the cause is carelessness, and other times an agent doesn't fully understand his or her fiduciary responsibilities.

23

Sometimes licensees don't disclose their true relationship in a transaction

This is the first step towards license revocation.