land conracts
What's a listing agreement?
the binding contract between the seller and your brokerage firm
~illegal ~can lead to disciplinary action ~can lead to monetary losses.
undisclosed limiting agency is
~Advocate for the seller ~Seek a sale of the property at the best price available or a price acceptable to the seller ~Inform the buyer that you represent the seller
what are Seller's Agent Duties
Comparative market analysis
what is a cma
price
what's always a factor with every listing presentation?
novation
An original party is replaced with a new party, and all rights and obligations belong to the new party.
(if you're acting as an agent for a party, then that party is your client) The seller is your client, leaving the buyer to be your customer in this type of single agent relationship.
.As a seller's agent, you have a relationship with both the seller and the buyer, but in what capacity?
Required
A definite ending date (determine whether it is—or isn't—a required element for a listing contract.)
True
A licensee isn't required to discover latent defects and must not advise on matters outside the scope of the licensee's knowledge.
true
A licensee must ensure the collection of the earnest money deposit from the buyer. Earnest money may be used as liquidated damages by the seller in the event of buyer default, so it's in the seller's best interest to ensure it's been deposited.
This is false. All compensation goes through the managing broker first, and the affiliated broker receives compensation according to the agreement established with the managing broker.
A licensee's compensation comes directly from the client or customer.
This is false. The listing licensee isn't required to verify the accuracy of statements the seller makes about the property if the licensee reasonably relied on those statements.
A listing licensee is responsible for independently verifying the accuracy of all statements the seller makes about the property.
reasonable time
if a contract doesn't specify a deadline or dates it is an example of
from his own broker
Douglas is the buyer's agent for a transaction in which May (from a different brokerage) listed her seller client George's property. From whom will Douglas receive his compensation?
Listing Agreement
is an employment contract between a licensee representing the brokerage company and a seller.
No, because the listing agreement is contractually binding.
Jared, a seller, has found his own buyer and wants to terminate his exclusive right-to-sell listing agreement with Sue, his listing broker. Can he do so without penalty?
delivery date
is what makes the contract binding.
Exclusive agency
Allows sellers to work with an agent while still trying to locate the buyer themselves
Exclusive right-to-sell
Allows the listing agent to list the property and receive a commission, no matter who brings the buyer to the table
open listing
Allows the seller to contract with multiple agents but only pay a commission to the agent who locates a buyer
Open Listing
An agreement with multiple licensees is an
This isn't required. All listing agreements must have a definite beginning date, not an approximate one.
An approximate starting date (determine whether it is—or isn't—a required element for a listing contract.)
Sue him for specific performance. requires the parties to make good on the promises they made. In this case, Ruth can sue Ahmed to replace the roof, as he promised in the contract.
Ahmed is selling his three-bedroom home to Ruth. Under the terms of their agreement, he must replace the roof, which was damaged in a severe thunderstorm. At the walk-through just before closing, Ruth learns he hasn't yet done this. She loves the house, though, and isn't interested in "making him pay"—she just wants the roof replaced. In this case, which of the following remedies could Ruth pursue?
true
All compensation must go through the broker.
This is an example of assignment of contract because although a new party has been selected as a substitute for the original party to the contract, the original party remains liable to the contractual terms. In many states, a contract is assignable as long as it does not say that it is NOT ASSIGNABLE. That means that you don't have to write "and/or assigns" on the contract to be able to assign it.
Before the transaction closed, Beauford substituted his cousin, Sylvester, as the buyer. He reserved his right to do so in the offer. Unless the contract between Beauford and the seller releases Beauford from his obligations, if Sylvester fails to perform, Beauford is obligated to do so.
~Post the listing to the MLS. ~Place a lockbox on the property. ~Install a for sale sign on the property.
Before you start advertising your clients' property and showing it to strangers, a few ground rules need to be established. These are usually covered in the listing agreement. Read the following statements and select the ones for which you'll need the seller's express permission.
The seller must give you permission to do so.
Before you're allowed to put a lockbox on a seller's property, what must occur?
Accept liquidated damages in the form of the earnest money deposit.
Bobby has signed a real estate contract with Zeke to purchase Zeke's three-bedroom cabin. Bobby's put down $20,000 in earnest money. However, three weeks later, Bobby finds out his company is relocating him and he has to back out of the contract. Zeke gets to keep that $20,000 from the earnest money, so he's not exactly crying into his beer. Which remedy is being used?
performance
Both parties have met all the terms agreed to in the contract.
This is an example of novation of a contract because a new party has replaced the original party in the contract, and the original party has been relieved of all contractual obligations.
Brad has accepted an offer in a new town. He gets his lender to allow him to substitute a new borrower for the loan. With everyone in agreement, Brad is relieved of his responsibility for the loan.
true
Brokerage compensation options include a flat fee, fee for service, or percentage of sale.
Rescinding the contract unilaterally
Bryce is tired of waiting for his subcontractor to get his part of the deal done. The agreed-upon deadlines have come and gone, and Bryce is losing money waiting for the subcontractor to meet his obligations. If the subcontractor isn't going to honor his commitments, neither is Bryce. He decides to consult with his attorney and then terminate the contract. Of what is this an example?
in Indiana, which of the following are requirements for listing agreements
Check with your broker for the approved form to use.
Compensation from the sale of Jerome's property must go through Alonzo before Clara receives her cut.
Clara is a licensee at CityScape Realty, where Alonzo is the managing broker. The brokerage has a listing agreement with Jerome to sell his property, and Clara is representing the brokerage as the listing agent. Which of these compensation-related statements is true?
true
Consumers compensate brokers for their services, generally in the form of a percentage of the sales price of the property involved in the transaction.
One party fails to meet the obligations of the contract.
First, what constitutes a breach of contract?
Time of the Essence
Gail was supposed to close on her new home by the end of May, but she kept asking the sellers if they could push the closing date back. Soon the summer was over, and she still hadn't closed. Gail was guilty of not adhering to which aspect of the contract?
exclusive right to sell
Gerald wants a real estate agent who's going to work hard for him, and he's willing to pay the agent no matter who brings the buyer to the table.
true
If a licensee is the procuring cause for a sale, that licensee may still earn compensation.
This is false. You must disclose all latent defects and material facts about a property that the buyer wouldn't see through diligent inspection, regardless of whether your seller wants you to or not.
If your seller client instructs you to not disclose a material fact about his property (that the buyer can't see through diligent inspection), then you should keep quiet about it.
the seller
In a seller agency relationship, to which party does the licensee owe undivided loyalty?
Exclusive agency
In which type of listing agreement does a seller contract with one listing agent but reserve the right to locate the buyer and only pay the listing agent if an agent locates the buyer?
true
Indiana listing agreements must have definite expiration dates.
true
Information regarding how the cooperating agent will be paid (determine whether it is—or isn't—a required element for a listing contract.)
Rescind the contract unilaterally Accept liquidated damages (Because Britney is the wronged party in this situation, she can make the call to terminate the contract without the other party's consent, and keep the liquidated damages of $10,000.)
Jasmine and Tony Disnee sign a sales contract with seller Britney to purchase her two-bedroom house. In the contract, the Disnees agree to pay $10,000 of their earnest money when the contract is accepted, and another $20,000 two weeks later. Two weeks pass, and they don't make the second payment. Britney rescinds the contract, keeping the earnest money.
Yes! Both parties have mutually agreed to rescind the contract.
Joe Dunlap is buying a house from Jenny Shaker for $230,000. They're only two weeks from closing when Joe finds out he's been laid off from his job. He and Jenny agree that it's best to cancel the contract, because without a job, Joe won't get approved for his loan. Jenny has a back-up contract on the property, so she moves ahead with that new buyer.
disclosure
Just as the agent has duties to perform, so do the sellers. What's one of the most important duties to have when offering their property for sale?
Exclusive agency
Kirby has a listing agreement with Bob. If Kirby or another agent locates the buyer, Kirby gets his listing commission. However, if Bob locates the buyer, Kirby does not earn a commission. What type of listing agreement do they have?
novation
Kirk and his cousin Dewey decided to buy a vacation home. They entered into a contract with the seller, Crystal. Before finalizing the sale, Dewey wanted out, but he didn't want to let his cousin down. So instead of pulling out altogether, Dewey convinced his son to replace him in the purchase contract. Kirk and Crystal agreed to the substitution, and Dewey was released from all his obligations under the contract. Dewey's son is now the contracting party. What's this an example of?
true
Listing agents have the duty to disclose all material facts that the buyer couldn't ordinarily see through a diligent inspection if the agents have actual knowledge of said defects.
~When the property sells and closes ~When the stated listing term ends, even if the property has not sold ~By mutual agreement ~By abandonment by the listing agent ~At the seller's request
Listings may be terminated:
The seller's written permission
Martin has a new listing. He wants to post a for sale sign in his seller's yard. What must he obtain before doing so?
Yes, if both the listing broker and the seller's agree in writing
May listing agreements be terminated without penalty?
Accepting partial performance
Megan finds herself in a breach of contract situation. While the other party met some of his obligations, some were not met. Megan thinks it would cost a lot of time and money to sue the other party. Thus, she decides to accept the work that has been done and call it good. Of what is this an example?
Yes! This is an example of performance of contract because both parties met the terms of the contract.
Millicent and her neighbor, Tommy, agree to swap houses. Because they both hate to move, they also agree to leave all of their furnishings behind, but take their personal belongings. Both parties do exactly what they say, and they don't even have to do a change of address—they simply install a vacuum mail chute between the two houses.
true
Never use a listing agreement or other form from an organization if you're not a current member of that group.
true
No cause of action can be made against a licensee who complies with the duty to disclose, unless the licensee provides information that's materially inaccurate, or the disclosure is made in bad faith or with reckless disregard for the truth.
true. As long as the client didn't have actual knowledge of the licensee's misrepresentation, that client cannot be held responsible for a licensee's misrepresentation.
No cause of action can be taken against a client for misrepresentation by a licensee representing the client, unless the client had actual knowledge of the misrepresentation.
true
Once all parties to a listing agreement have signed the agreement, it becomes a legal contract.
fatca
Once you and the property owners have signed a listing agreement, as a representative of your brokerage, it's a bona fide legal contract.
assignment
One of the original parties transfers rights to a different party but may still be liable for obligations.
informed consent
Real estate law in Indiana requires you to get; means that all parties fully understand the ramifications and purpose of limited agency
Options a wronged party has to remedy a breach of contract
Rescission, suit for specific performance, liquidated damages, and acceptance of partial performance are all examples of what?
Have you done any recent upgrades? Is there anything you're planning to do to prepare the property for sale before you list? When do you need to sell? Do you know where you're moving next? Have you had a recent appraisal done? If so, what were the numbers? Do you have a price range in mind that you need to get from the property? What do you currently owe on the property? Is there anyone else who will need to be involved in the decision to sell?
Setting the Stage at the First Meeting
No, because there isn't one
Should you and your clients fill out and sign Indiana's official listing agreement form?
Time is of the essence
What phrase do many real estate contracts contain that reminds the parties to avoid unnecessary delays to the transaction, and to adhere to all contract dates?
true
The amount a licensee is compensated is dependent upon the agreement with the managing broker.
This is false. Even the suggestion of a standard fee is an antitrust violation.
The industry has a "standard" compensation fee.
Time is of the essence.
What phrase is often used in contracts to convey the need for the parties to proceed in good faith and not unduly delay the process?
Seek a sale at the best price at terms acceptable to the seller.
What responsibility does the seller's agent have to the seller?
What is meant by "reasonable time"?
The parties must make assumptions about the timeframe in which they must meet their contractual obligations.
Time is of the essence
The parties will be held in strict compliance to any timeframes specified in the contract.
This isn't required. A listing agreement must have the property's listing price. The final sales price won't be known until it sells.
The property's final sales price (determine whether it is—or isn't—a required element for a listing contract.)
true
The real estate commission doesn't prescribe a standard listing agreement form.
You should manage the process from start to finish.
What's your responsibility as a listing agent relative to the transaction as a whole?
The licensee is permitted to list other properties for sale, even if they're competing properties.
When a licensee represents a seller, which one of the following statements is true about the licensee's ability to list other properties that are for sale?
in Indiana, which of the following are requirements for listing agreements
To be legally enforceable, listing agreements must be in writing.
Binding Acceptance
Tristan's offer has been signed by all parties and delivered to the seller. This means that ______ has occurred.
~Acceptable sales price ~Timing of sale ~Whether the timing of the sale is important ~What type of financing the seller is willing to accept. ~Timing of vacating the property
What are some common seller needs she should understand before marketing the property?
~Both parties agree to terminate the contract. ~The innocent party terminates the contract. ~The guilty party can terminate the contract with permission from the aggrieved party.
What does it mean for the parties when a breach of contract occurs?
CMA MLS listing sheets for comparable properties Marketing plan Listing contracts
What items typically should bring to a listing presentation?
listing agreement
When you represent a seller, which of these agreements is the standard to use?
Schedule the open house soon after the property hits the market.
Which of the following actions should be taken when holding an open house?
It's a type of agency agreement.
Which of the following best defines a listing agreement?
An employment contract between a licensee representing the brokerage company and a seller
Which of the following could a listing agreement be considered?
A percentage of the amount that the broker receives
Which of the following is a legal form of compensation for licensees?
The listing agent stops working on the listing.
Which of the following is a legitimate and legal way that an exclusive right-to-sell listing agreement may terminate without the seller owing a commission?
Ensure the collection of the earnest money deposit from the buyer.
Which of the following is often a seller's agent's duty?
They often involve a conflict of interest.
Which of the following is true about net listings?
You should go into the presentation fully prepared with a comparative market analysis, listing agreement, MLS listings of comparable properties, and your plan for marketing the sellers' property.
Which of the following statements is true about the listing presentation?
Reviewing offers and explaining any special requests or requirements
Which of these choices is an example of a listing agent negotiating on a seller's behalf?
Ensure that the buyer's earnest money is deposited.
Which one of the following tasks must licensees perform for seller clients?
Property sellers and their agent
Who are the parties to a listing agreement?
To use information from a tour to prepare the CMA
Why might a licensee want to make two visits to the property as part of a listing presentation?
This is false. If the owner finds a buyer, is the agent who was listing the property still owed a commission?
With an exclusive agency agreement, only one broker lists the property, and regardless of who finds a buyer (the listing broker, any other broker or agent, or the owner), the listing agent is owed a commission. (t/f)
facts
With an exclusive agency agreement, only one broker lists the property. If that broker or any other broker or agent sells the property, the listing agent is owed a commission as agreed to in the agency agreement. However, if the owner finds a buyer, then no fee is owed.
Marketing and advertising expenses to date Full commission if a ready, willing, and able buyer were found
Without the broker's permission, a seller terminated a listing agreement before the date stated in the contract. What two things might the seller owe?
Latent defects
are concealed, hidden, or likely to only be recognized by a trained professional
patent defects
are in the open and could be spotted by a layman (e.g., water stains, exposed wiring).
Net Listing
can be used with any of the listing contracts we've discussed.