Maryland Real Estate (Law) Chapter 2 - Agency

How and when should it first be revealed to prospects that they have presumed buyer representation? 1. orally, at the initial interview between the licensee and prospect 2. in writing, when the prospect signs a written agreement to be a client 3. in writing, before the end of the first scheduled face-to-face meeting 4. in writing, when the possibility of dual agency arises

1. Orally, at the initial interview between the licensee and prospect In §17-533(i)(1), the Brokers Act requires this disclosure, orally, at a licensee's first meeting (not first, scheduled, face-to-face meeting) with a prospect. Licensee must also then disclose that the prospect can decline presumed representation. The prospect's signing a representation agreement would not reveal PBR; it would end it. If dual agency has arisen because prospect has been shown an in-house property, PBR has also ended. I learned it as answer (3. in writing, before the end of the first scheduled face-to-face meeting) check new requirements for this answer

Which statement about cooperating agents (as defined on the Understanding Whom Real Estate Agents Represent form) is FALSE? 1. cooperating agents can represent the buyer 2. cooperating agents are subagents of the listing broker 3. cooperating agents bring in customers/buyers and are from a company other than the listing company 4. a cooperating agent who brings in a buyer has fiduciary duties to the seller-owner

1. cooperating agents can represent the buyer A cooperating agent is the subagent of the listing broker who represents the sellers; therefore, the cooperating agent cannot represent the buyers, only assist them by bringing them to the listing company. Cooperating agents' fiduciary duties are to sellers.

Brokers' principals are called: 1. managers 2. clients 3. prospects 4. customers

2. clients Real estate brokers' principals are their clients Brokers are agents of their principals.

Which is TRUE when brokers handle the purchase and sale of residential real property? 1. they are agents of the owner of the property being bought or sold 2. they may not act as the agent of the buyer 3. they may not represent both buyer and seller in the same transaction without the designation of two intra-company agents. 4. they may personally represent both buyer and seller if both parties agree

3. they may not represent both buyer and seller in the same transaction without the designation of two intra-company agents. Such dual agency can be performed in Maryland real estate only when a broker appoints two such intra-company agents

Which of the following statements about agency is TRUE in Maryland? 1. Maryland does not allow a brokerage firm to represent both buyer and seller in the same transaction 2. dual agency is permitted only in brokerage firms consisting of three or more licensees 3. a licensee's performance of ministerial duties for a customer justifies the claim by that customer that the licensee "...acted in a way that indicated she was my agent." 4. the broker of a firm may act as one of the two intra-company agents required for dual agency

2. dual agency is permitted only in brokerage firms consisting of three or more licensees Only firms with a minimum of three licensees may engage in dual agency under Maryland law because there must be two intra-company agents appointed by a broker.

Which of the following is TRUE of brokers when they represent buyers of real estate? 1. they are regarded by the law as dual agents in such transactions 2. they must disclose this agency relationship to sellers 3. they are in violation of the Brokers Act 4. they will not be compensated

2. they must disclose this agency relationship to sellers A broker who represents a client-buyer must disclose that fact to any seller or the agent of any seller he encounters.

Which of the following is TRUE about the Understanding Whom Real Estate Agents Represent disclosure of agency representation form? 1. it constitutes a contract for buyer representation when the fourth box is checked and the prospect signs the form 2. it ends presumed buyer representation no matter what box is checked, whether or not the prospect signs it 3. failure to properly present the form constitutes a violation of the Brokers Act by the licensee 4. the prospect is required by law to acknowledge receipt of the form by signing it

3. failure to properly present the form constitutes a violation of the Brokers Act by the licensee The Brokers Act requires licensees to present the disclosure of representation form (Understanding Whom Real Estate Agents Represent) at the first scheduled, face-to-face meeting with buyer prospects. When licensees represent buyers, they must also present properly completed Understanding Whom forms to sellers at first contact. The disclosure of agency representation form, when delivered - whether signed by the prospect or not - never creates or ends a contract or a relationship.

Which of the following does NOT end presumed buyer representation? 1. prospects orally decline presumed representation 2. prospects decide to make an offer for property listed by a company other than the company representing them 3. licensee working with prospects fails to present a disclosure of representation form 4. licensee shows prospects a property listed with a firm other than the licensee's

3. licensee working with prospects fails to present a disclosure of representation form Whether or not the licensee presents the agency disclosure form, the prospect is still presumed by law to have presumed buyer representation (PBR) until either the prospect or the licensee refuses PBR, prospect is shown a property listed by the licensee's firm, prospect wants to prepare an offer on any property, or prospect enters into a formal representation (buyer broker) agreement.

When must a licensee who is representing a seller disclose this fact to the buyer? 1. at first contact 2. when an offer is made 3. no later than the first scheduled face-to-face meeting 4. when the buyer or agent of the buyer asks

3. no later than the first scheduled face-to-face meeting Title 17, the Brokers Act, requires disclosure not later than the firs scheduled face-to-face meeting with the buyer or seller prospects. The rule for REALTORS®, by contrast, is disclosure of representation at the first contact. To wait until an offer is made - or until a party requests disclosure of representation - is to violate the law and also risk possible collapse of a settlement, with consequent litigation, and costly disciplinary action by the Commission.

Which of the following does a licensee NOT owe to a customer? 1. due care 2. disclosure of material facts 3. obedience 4. honesty

3. obedience Agents must obey their clients, not their customers. The other three duties are owed to customers as well as clients.

When may a brokerage lawfully perform dual agency? 1. when the firm has been certified by the Commission for dual agency brokerage 2. when the firm has only two individual licensees in it 3. when the firm's broker (or the branch manager) designates two company licensees -- one to represent (be the intra-company agent for) the seller and another for the buyer 4. when both sellers and buyers have agreed to dual agency on a particular property

3. when the firm's broker (or the branch manager) designates two company licensees -- one to represent (be the intra-company agent for) the seller and another for the buyer Lawful dual agency requires that the firm designate two licensees as intra-company agents (ICA's), one for each party. Agreement by the parties to dual agency is required but not, by itself, sufficient. A firm with only a broker and one agent cannot meet this requirement because the broker may not serve as an ICA. The Commission does not certify for dual agency; it merely enforces statutory requirements for its performance.

Arthur has been assigned by his broker, Bettina, to work with Carlos to provide buyer representation for the purchase of a property listed by Dorene, a salesperson with Bettina's company. Bettina has named Dorene to represent the seller. In this situation, which of the following is TRUE? 1. Carlos is a prospect; Arthur is his intra-company agent; Bettina is a single-agency broker; and Dorene is the intra-company agent for the seller 2. Carlos is a client; Arthur is his intra-company agent; Bettina is a disclosed dual agent; and Dorene is the intra-company agent for the purchaser 3. Carlos is a customer; Arthur is his salesperson 4. Carlos is a client; Arthur is his intra-company agent; Bettina is not a single-agency broker; and Dorene is the intra-company agent for the seller.

4. Carlos is a client; Arthur is his intra-company agent; Bettina is not a single-agency broker; and Dorene is the intra-company agent for the seller. The players are properly identified in choice (4). Bettina is not a single-agency broker because she is performing dual agency here through her company.

Which statement concerning agency is TRUE? 1. a broker may be considered the agent of the party from whom the broker receives payment 2. a broker is allowed to be a dual agent in a transaction if no harm is done 3. a salesperson may personally perform dual agency if both buyer and seller agree in writing 4. a broker who represents both buyer and seller in the same transaction must appoint two intra-company agents

4. a broker who represents both buyer and seller in the same transaction must appoint two intra-company agents The only way a firm may represent both buyer and seller in the same transaction is for its broker (or branch manager) to appoint tow intra-company agents - one to represent the buyer, the other to represent the seller. Neither a salesperson nor a broker can personally represent both the buyer and seller in a transaction, even with the parties' permission. "No harm" is no excuse for a broker's improperly conducting dual agency.

Which of the following is NOT a duty agents owe to their principals? 1. disclosure of all facts 2. loyalty 3. timely presentation of all written offers and counteroffers 4. reporting to a client-buyer that one of the seller's family members had AIDS

4. reporting to a client-buyer that one of the seller's family members had AIDS It is a violation of privacy under the Americans with Disability Act to state that a present or former occupant of a property under consideration by a purchaser had or is said to have had HIV, AIDS, or AIDS-Related Complex (ARC). No fiduciary duty is breached by withholding such information or opinion.

Which of the following is TRUE concerning presumed buyer representation? 1. presumed buyer representation begins when a licensee shows a prospective purchaser property listed by another brokerage firm 2. presumed buyer representation ends when a licensee shows a prospective purchaser property listed with another brokerage firm 3. a prospective purchaser who declines to enter into a buyer representation agreement is no longer owed confidentiality about matters previously discussed 4. the licensee can no longer be the presumed buyer representative of a purchaser who makes an offer on a property

4. the licensee can no longer be the presumed buyer representative of a purchaser who makes an offer on a property Presumed buyer representation (PBR) begins when a prospect seeks assistance to rent or buy residential property. PBR ends when a buyer asks to make a contract offer on a property. PBR also ends when the licensee shows the prospect a property listed with the licensee's firm. [Although this fact is ignored in the practice of many agents, 17-533(d) states, "A licensee who is acting as a presumed buyer'd or lessee's agent may show and assist the buyer or lessee only on real estate that is not listed by the broker of that licensee.] PBR does not end when a prospect is shown the property of another firm.