UNIT 9: REAL ESTATE AGENCY

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what are the six duties of a fiduciary?

-care -obedience -loyalty -disclosure -accounting -confidentiality

an agency may be terminated for any of the following reasons:

-completion of purpose -death -destruction -expiration of terms -mutual agreement -breach by parties -law

real estate professional's duties to the customer includes:

-reasonable care and skill -honest and fair dealing -disclosure of all facts

implied agreement

A contract under which the agreement of the parties is demonstrated by their acts and conduct.

buyer representation agreement

A principal-agent relationship in which the real estate professional acts on behalf of the buyer, usually as an agent, with fiduciary responsibilities to the buyer.

designated agency

A process that accommodates an in-house sale in which two different agents are involved.

designated agent

A real estate professional authorized by a broker to act as the agent for a specific principal in a particular transaction

buyer's agent

A real estate professional who is under contract to locate property for a buyer and represent the buyer's interests in a transaction.

fiduciary relationship

A relationship of trust and confidence, as between trustee and beneficiary, attorney and client, or principal and agent.

express agency

An agency relationship based on a formal agreement between the parties.

listing agreement

An agency relationship between a real estate seller and a broker is generally created by a written employment contract

nonagent

An intermediary between a buyer and a seller, or a landlord and a tenant, who assists one or both parties with a transaction without representing either

express agreement

An oral or written contract in which the parties state the contract's terms and express their intentions in words.

fraud

Deception intended to cause a person to give up property or a lawful right.

puffing

Exaggerated or superlative comments or opinions.

transaction broker

Helps both the buyer and the seller with paperwork and formalities in transferring ownership of real property, but who is not an agent of either party.

implied agency

If the actions of the parties imply that they have mutually consented to an agency relationship

fiduciary

One in whom trust and confidence is placed; a reference to a real estate professional employed under the terms of a listing contract or buyer representation agreement.

general agent

One who is authorized by a principal to represent the principal in a specific range of matters.

agency

The relationship between a principal and an agent wherein the agent is authorized to represent the principal in certain transactions.

latent defect

a hidden structural defect that would not be discovered by ordinary inspection.

universal agent

a person empowered to do anything the principal could do personally.

agent

a person who acts or does business for another

special agent

authorized to represent the principal in one specific act or business transaction only.

agents must exercise a reasonable degree of ______ while transacting the business entrusted to them by principals

care

the duty of _______________ includes relevant information or material facts that the agent knows or in some cases should have known

disclosure

t/f An express agreement occurs when the actions of the parties indicate that they have mutually consented to an agency.

false

t/f Exaggeration of a property's benefits is called puffing and is illegal.

false

t/f The fundamentals of general agency law have changed dramatically over the past two hundred years.

false

t/f The universal agent's authority to act on behalf of the principal is significantly limited.

false

the agent must be able to report the status of all ______ from or on behalf of the principal

funds

the duty of ______________ requires that the agent place the principal's interest above of all others, including the agent's own self-interest

loyalty

the fiduciary relationship obligates an agent to act in good faith at all times,____________ the principal's lawful instruction in accordance with the contract

obeying

megan's law

promotes the establishment of state registration systems to maintain residential information on every person who kidnaps children, commits sexual crimes against children, or commits sexually violent crimes.

single agency

the agent represents only one party to a transaction

dual agency

the agent represents two principals in the same transaction.

principal

the individual who hires the agent and delegates to that agent the responsibility of representing the principal's interests.

statutory law

the laws enacted by the legislature

client

the principal in a real estate transaction for whom a real estate broker acts as agent.

administrative law

the rules and regulations created by real estate commissions and departments

common law

the rules established by tradition and court decisions

customer

the third party or nonrepresented consumer who is not a principal but for whom some level of service may be provided and who is entitled to fairness and honesty.

stigmatized properties

those that society has found undesirable because of events that occurred there or because of proximity of the property to a known nuisance

t/f A universal agent is a person empowered to do anything the principal could do personally.

true

t/f An express agreement, in which the parties formally express their intention to establish an agency and state its terms and conditions, may be either oral or written.

true

t/f In traditional common law, the relationship in which the agent is held in a position of special trust and confidence by the principal is one of a fiduciary

true

t/f The real estate professional's duty to a third party (customer) includes disclosure of all facts that the real estate professional knows or should reasonably be expected to know that materially affect the value or desirability of the property.

true

t/f an agent may not disclose the principal's personal information in any circumstance

true

negligent misrepresentation

when the real estate professional should have known that a statement about a material fact was false.


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