Course 1 Unit 9
The person employed by a principal to act on his behalf is an_______________
agent
Depositing a client's money in the same account with the same account with the broker's money (which is illegal) is ____________
commingling
Using trust funds for personal reasons is?
conversion
When a broker serves as the agent for both the buyer and the seller, it is a ________ agency
dual
A buyer representation contract that appoints a broker as the sole agent to find a property for a buyer, but allows the buyer to find her own property without paying a commission, is an __________
excluive agency
A listing contract in which the owner agrees to pay the agent a commission regardless of who sells the property during the listing period is an ____________ listing.
exclusive right-to-sell
The relationship of a broker to his principle is a __________ relationship.
fiduciary
The buyer's broker should deliver the earnest money to the listing broker_________ after acceptance of the offer.
immediately
Commissions are calculated as a percentage of A) the buyer's net. B) the seller's net. C) the listing price. D) the selling price.
D) the selling price.
While ahowing an income-prodcuing property, the broker advised the consumer that the property is likely to be very profitable in the future because of its location. The broker's actions might result in the creation of A) universal agency B) gneral agency C) ostensible agency D) implied agency
D) implied agency
What is the commission rate of 5% on a sale of $250,000? A) $12,500 B) $3,571 C) $1,750 D) $25,000
A) $12,500
A salesperson holding an open house is approached by a customer asking for advice on what to offer for the property. What should the salesperson do next? A) Inform the customer to not share confidential information B) Ask the customer to initial the listing agreement. C) Have the buyer sign a transaction brokerage agreement D) Ask probing questions in an effort to learn confidential information
A) Inform the customer to not share confidential information
A broker who represents a seller under an exclusive agency listing receives 2 offers for the property at the same time, 1 from one of his salespeople and 1 from the salesperson of a cooperating broker. What should the broker do? A) Submit both offers at the same time B) Submit the offer from his salesperson first C) Submit the offer from the other salesperson first D) Submit the higher offer first
A) Submit both offers at the same time
A broker must deposit earnest money, rents, and security deposits in which account? A) The broker's trust account B) The owner's bank account C) The salesperson's trust account D) The broker's business account
A) The broker's trust account
A lsiting in which the principals agree to contract with only one broker but reserve the right to sell property themselves without any liability ti tge brokerage for paying a commission is A) an exvlusive agency listing B) an open listing C) an exclusive right-to-sell listing D) a net listing
A) an exvlusive agency listing
In an open listing, a broker recieves a commission A) by procuring the buyer B) by offering a co-op to other brokers in the MLS C) from anyone who sells the property D) only if thr seller does not sell the property
A) by procuring the buyer
When a property manager signs a property manaagement contracct with an owner, the property agement contact with an owner, the property manager is a A) fiduciary of the property owner B) third party to the contract C) universal agent of the broker D) principal of the property owner
A) fiduciary of the property owner
A property manager is BEST described as a A) general agent B) special agent C) universal agent D) facilitator
A) general agent
Commissions are negotiable A) in all cases. B) when using an exclusive listing agreement but not an open listing. C) unless the exclusive agency listing is used because the seller can compete with the broker. D) unless representing a buyer when the listing broker offers a co-op.
A) in all cases.
If a broker and a seller have a fiduciary relationship, the broker could A) inform a buyer that the seller will accept substantially less than the listed price B) fai to tell the buyer about hidden structural problems in order to protect the seller C) disclose the buyer's financial qualifications D) honor the seller's request to refuse to show the property to minorities
A) inform a buyer that the seller will accept substantially less than the listed price
The property manager's first obligation is to A) maintain the value of the property B) earn a profit C) find high quality tenants D) hire good contractors
A) maintain the value of the property
A listing broker is typically the A) seller's agent B) buyer's principal C)buyer's agent D) third party
A) seller's agent
The listing broker splits commissions with the cooperating broker on a 60:40 basis with 60% retained by the listing company. The cooperation(selling) brokerage splits with the selling salespereson with 70% to the salesperson. What does the selling salesperson earn if the sales price is $295,000 and the negotiated commission rate was 5.5%? A) $1,947 B) $4,543 C) $6,490 D) $6,815
B) $4,543
A broker enters into a listing agreement with a seller in which the seller will receive $120,000 from the sale of a vacant lot and the broker will receive any sale proceeds exceeding that amount. This is what type of listing? A) Exclusive right-to-sell B) Net C) Multiple D) Exclusive agency
B) Net
Which of the following BEST defines the law of agency? A) Selling of another's property by a properly licensed brokerage company B) Rules of law that apply to the responsibilities of a person who acts as agent for another C) Principles that govern conduct in business D) Rules and regulations of the state's licensing agency
B) Rules of law that apply to the responsibilities of a person who acts as agent for another
In an exclusive right-to-sell listing, the principal contracts A)with several brokers, each of whom deals with only one third party B) to pay the broker a commission regardless of who procures the uyer C) with only one broker, but reserves the right to sell property herself without paying a commission D) with several brokers
B) to pay the broker a commission regardless of who procures the uyer
The document used to form the relationship between the agent and the principal is A) an open listing B) a fiduciary agreement C) a facilitation contract D) a lease
B) a fiduciary agreement
A home warranty on an existing home is determined A) by standard practices in the area B) by the terms of the contract with the company C) per federal and state law D) by zoning of the home
B) by the terms of the contract with the company
The broker deposits trust funds into the firm's operative account. This is an example of A) conversion B) commingling C) proper accounting D) fraud
B) commingling
A broker receives a check for earnest money from a buyer and deposits the money in the broker's personal interest-bearing checking account over the weekend. This action exposes the broker to a charge of A) accretion. B) commingling. C) subrogation. D) novation.
B) commingling.
All of the following must be placed in the brokerage trust account EXCEPT A) security deposits. B) commissions. C) rents. D) earnest money.
B) commissions.
Todd is a real estate broker employed by buyer Maria. When Todd finds a property that Maria might be interested in buying, he is careful to find out as much as possible about the property's owners and why their property is on the market. Todd's efforts to keep Maria informed of all facts that could affect a transaction is the duty of A) loyalty. B) disclosure. C) accounting. D) confidentiality.
B) disclosure.
What duties does a listing agent owe to a third party buyer? A) fairness and disclosure of benefits and risks B) honesty, accounting, and disclosure of material facts C) honesty, confidentiality, and fairness D) disclosure of material facts, honesty, and loyalty
B) honesty, accounting, and disclosure of material facts
After a sale, the land parcel is found to be 10% smaller than the seller claimed. The real estate professional who passed this information on to the buyer is A) not liable as long as the real estate professional only repeated the seller's data. B) liable if the real estate professional knew or should have known of the discrepancy. C) not liable if the buyer actually inspected the parcel. D) not liable if the misrepresentation was unintentional.
B) liable if the real estate professional knew or should have known of the discrepancy
The amount of commission paid to a brokerage is established by A) state law B) negotiation between the broker and the seller C) local custom D) real estate boards
B) negotiation between the broker and the seller
A seller signed an exclusive agency listing with a brokerage firm. If the seller finds a suitable buyer with no assistance, the firm is entitled to A) full compensation from the seller. B) no compensation from the seller. C) partial compensation from the seller. D) full compensation from the buyer.
B) no compensation from the seller.
A real estate professional acting solely as a seller's agent is MOST likely to be held liable for claims of misrepresentation by abuyer if the professsional committed which of these acts in the course of the transaction? A) failed to provide previous purchase prices for the property B) obeyed the seller's instructions to leave all discussions of property condition to the seller C) continued to accept and present offers on the property after the seller accepted the buyer's offer D) depostited the earnest money check in a personal account to clear befpre tranferring it to the trust account
B) obeyed the seller's instructions to leave all discussions of property condition to the seller
The clause in a listing contract that protects the broker's commission if someone with whom the broker negiotiated purchases the property after the expiration of the listing is known as a A) nondiscrimination clause B) protection or safety clause C) due-on-sale clause D) cooperation clause
B) protection or safety clause
A property manager should A) have an exclusive right-to-sell agreement. B) call the owner if there are minor problems. C) invest the profits. D) seek high-quality tenants.
D) seek high-quality tenants
If a seller informs a salesperson that the house is for sale "as is." The salesperson should A) inform all potential buyers that there is nothing wrong with the porperty even though the salesperson has not inspected it B) visually inspect the property, and if the salesperson sees a water leak in the ceiling, the salesperson should inform potential buyers about it C) allow the seller to handle all converstaions with potential buyers about the condition of the property D) advise potential buyers that an "as is" property requires no property disclosures
B) visually inspect the property, and if the salesperson sees a water leak in the ceiling, the salesperson should inform potential buyers about it
Assuming that the listing broker and selling broker split their commission from a transaction equally, what was the sales price of the property if the commission rate was 6.5% and the listing broker received $12,593.50? A) $193,746 B) $139,900 C) $387,492 D) $256,200
C) $387,492
A home sells for $325,000 and the brokerage firm recieves $19,560 in commissioin. What was the commission rate paid by the seller? A) 3% B) 5% C) 6% D) 17%
C) 6%
A real estate salesperson has obtained a listing. Who owns the listing contract? A) Seller B) Branch manager C) Brokerage firm D) Salesperson
C) Brokerage firm
Real estate agents must point out undisclosed "red flag" issues. Which of the following would NOT be considered a red flag issue? A) Water stains B) Leaking pipes C) Recorded mortgage lien D) Sagging floors
C) Recorded mortgage lien
A salesperson met with a seller, and the seller signed a listing agreement. The seller's agent is A) the broker associate. B) the manager. C) the salesperson. D) the brokerage.
D) the brokerage.
A salesperson who had a listing died. What is the present status of the listing? A) The listing has terminated. B) The seller has the right to terminate. C) The listing is still in effect. D) The broker has the right to terminate
C) The listing is still in effect.
All of the following are true EXCEPT A) a group of brokerage firms cannot make agreements to avoid using a certain title company B) commissions may be set by the brokerage firm and then negotiated by a company broker or salesperson with a buyer or seller C) commissions are typically set by the MLS and boards of REALTORS then finalized by the brokerage firm D) a group of brokerage firms may not make agreements to only list properties in certain territories
C) commissions are typically set by the MLS and boards of REALTORS then finalized by the brokerage firm
An agent owes the principal all of the following EXCEPT A) disclosure. B) obedience. C) consideration. D) loyalty.
C) consideration
A real estate agent's fiduciary obligations include all of the following EXCEPT A) acting as an advocate B) obedience and loyalty C) disclosure of confidential information about the prinicipal D) disclosure of all risks and benefits of the transaction
C) disclosure of confidential information about the prinicipal
The owner of a property has signed an exclusive right-to-sell listing contract. In this case, the owner A) has promised to accept a reasonable offer B) has promised to accept any offer identical to the listed price and terms C) has promised to pay a commission if the property is old during the listing period D) will pay only ther brokerage who finds a buyer
C) has promised to pay a commission if the property is old during the listing period
The contract that allows a property manager to screen tenants and collect rent is a A) lease contract B) gross contract C) management contract D) exclusive right-to-sell lsiting contract
C) management contract
A seller tells the broker that if he sells the seller's home, the seller will pay him a commission. This arrangement is MOST similiar to which listing contract? A) exclusive right to sell B) exclusive agency C) open listing D) net lsiting
C) open listing
If the principal insists that he will not sell his house to members of a certain ethnic group, the broker must A) obey his request, in accordance with the law of agency B) report the seller to the police C) refuse to honor the request D) obey the request but decline a commission
C) refuse to honor the request
If a new home has major issues after one year, generally the buyers will be covered A) only if they purchased a new home warranty B) only if the home builder offers warranties C) under statte or local laws D) if the damage is more than $100,000
C) under statte or local laws
The brokerage firm has recieved an earnest money deposit on a listing. The brokerage firm should A) deposit it in the firm's operations account B) deposit it within five days C) hold the earnest moeny until the lender sends notice to deposit D) follow the terms of the purchase contract for depositing
D) follow the terms of the purchase contract for depositing
A real estate professional obtained a listing agreement to act as the agent in the sale of a house. An unrepresented buyer has been found for the property, and all agreements have been signed. As an agent for the seller, the real estate professional is responsible for which activity? A) Scheduling the buyer's inspection of the property B) Ensuring that the buyer is qualified for the new mortgage loan C) Completing the buyer's loan application D) Making sure that the buyer receives copies of all documents the seller is required to deliver to the buyer
D) Making sure that the buyer receives copies of all documents the seller is required to deliver to the buyer
A seller signed a 90-day listing agreement with a licensee. Two weeks later, before any offers could be presented, the seller was killed in an accident. What is the present status of the listing? A) The listing agreement is binding on the seller's estate only if the licensee can produce an offer to purchase the property within the remainder of the listing period. B) Because the seller's intention to sell was clearly defined, the listing agreement is still in effect and the licensee may proceed to market the property on behalf of the seller's estate. C) The listing agreement is binding on the seller's estate for the remainder of the 90 days. D) The listing agreement was terminated automatically when the seller died.
D) The listing agreement was terminated automatically when the seller died.
A real estate professional listed an agricultural property at an 8% commission rate. After the sale of the property and the settlement had taken place, the seller discovered that the real estate professional had been listing other properties at a 6% commission rate. Based on this information, which statement is TRUE? A) The seller is entitled to a refund from the real estate professional of 2% of the commission. B) If the real estate professional inflated the usual commission rate for the area, the real estate professional may be subject to discipline by the state real estate commission. C) The seller is entitled to rescind the transaction based on the principle of lack of reality of consent. D) The real estate professional has done nothing wrong because a commission rate is always negotiable between the parties.
D) The real estate professional has done nothing wrong because a commission rate is always negotiable between the parties.
If a property does not sell, would the listing agreement eventually end? A) No, listing agreements have an indefinite duration. B) Yes, but listings only expire when the property eventually sells. C) No, listing agreements automatically renew. D) Yes, upon the expiration date in the listing contract.
D) Yes, upon the expiration date in the listing contract.
A brokerage firm that hires salesepersons as independent contractors should supply them with A) set work schedule B) paid vacations C) notice of the brokerage firm's witholding for taxes D) a contract that the salespersons may set their own hours
D) a contract that the salespersons may set their own hours
All of the following will terminate a listing without liability EXCEPT A) destruction of the property B) mutual agreement C) expiration D) death of the salesperson
D) death of the salesperson
A real estate professional is employed by a buyer. When the real estate professional finds a property that the buyer might be interested in buying, she is careful to find out as much as possible about the property's owners and why their property is on the market. The real estate professional's efforts to keep the buyer informed of all facts that could affect a transaction is the duty of A) confidentiality. B) loyalty. C) accounting. D) disclosure.
D) disclosure.
Which of the these would be LEAST likkely to appeat in a listing contract? A) negotiable commission clause B) expirationdate C) listing price D) estimated closing costs
D) estimated closing costs
Real estate commission charged by a firm are determined by the __________
brokerage firm
The responsibilities of a property manager are to ___________ and seek _____________
maintain values, well-qualified tenants
Commisions charged by brokerage firms for their services are set by ________________
negotiation
A listing the allows an owner to list concurrently with more than one broker is an ____________ listingk
open
One who employs an agent to act on her behalf is a ___
principal
Earnest money must be deposited in the broker's _______________
trust account
A special agent can become a general or universal agent through a ________________
written agreement
