RE - 172 - CH 2

Water heater and smoke detector disclosures

Ca law requires water heater and smoke detectors be braced, anchored, or strapped to prevent damage in an earthquake.

The standard listing period for residential properties is 60 days. True or False

False Listing periods of 90 days are probably the most common. You should recommend a period that gives you enough time to market the property and close the transaction, based on the sales price range and market conditions.

The excerpt show above is known as unilateral offer of subagency clause. True or False

False This is actually an example of an offer of cooperation clause.

The clause shown above protects the seller from vicarious liability for mistakes made by you or your broker. True or False

False This is an example of hold harmless clause. It protects you and your broker from legal expenses incurred due to misrepresentations by the seller.

The most common form in which a broker is compensated is through a commission that is fixed dollar amount. True or False

False Commissions are usually expressed as a percentage of the sales price.

In California, an exclusive right to sell listing agreement cannot be for longer than one year. True or False

False Exclusive agency and exclusive right to sell listing agreements must have a definite termination date, but there is no minimum or maximum length. The duration of the agreement is entirely negotiable between the parties.

If a home was built after 1978 the seller must use a lead-based paint disclosure form. True or False

False The lead-based pain disclosure requirements apply to houses built before 1978.

A listing agreement can only be terminated by mutual agreement True or False

False Either the seller or broker can make a unilateral decision to terminate the listing agreement. However, the party that revoke the agreement may be liable for damages.

The paragraph show above makes the MLS a party to the listing agreement. True or False

False The MLS is not a party to the listing agreement. The information shown is simply tell the seller that the broker will be submitting the listing to the MLS.

The listing agent should fil out the transfer disclosure statement on behalf of the seller. True or False

False The agent fills out a separate section of the form, based on her visual inspection of the property. You could be liable for any inaccuracies if you fill out the seller's section.

A buyer who decides to rescind the purchase agreement after receiving a transfer disclosure statement must do so within seven business days of receiving the statement. True or False

False The buyer has three days in which to rescind the agreement if the transfer disclosure statement is delivering in person. If the statement is mailed, the buyer has five days from the date it is deposited in the mail.

You must use a standard pre-printed form from the MLS in order to satisfy the requirement that the listing agreement is in writing. True or False

False Any written agreement is acceptable, so long as it identifies the property and specifies how the broker will be compensated. It is always easiest, though to use a pre-printed form.

Supplemental statutory and contractual disclosure

For instance, if the seller knows that an illegal controlled substance has been released on the property, the law requires the seller to disclose this. This form can also be used to disclose: the property is a condominium or located in a common interest subdivision, insurance claims affecting the property in the last 5 years, issues affecting title, the property is located in an area zoned for commercial or industrial use, the property is close to an airport and may be affected by noise or vibration, the property has been contaminated by methamphetamine, the property is near a former military training site that may have unexploded munitions on it, or a death occurred on the property within the last three years. Two additional disclosures required by recnetly-passed statues are disclosures concerning pipeline safety and sex offenders.

Exclusive Agency Listing

The second type of listing agreement is the exclusive agency listing. Under an exclusive agency listing, your broker is entitled to a commission if anyone other than the seller finds a buyer for the home. If you (the listing agent) find the buyer, the seller must pay the commission. But if the seller finds the buyer without the help of any real estate agent, she doesn't owe your broker a commission. The major problem with exclusive agency listings is the potential for a dispute between your broker and the seller over who procured the buyer.

Any latent defect must be disclosed, even if there is not a specific question on the transfer disclosure statement about the particular tope of defect. True or False

True All latent defect must be disclosed, regardless of whether they are addressed in the transfer disclosure statement.

If you need to extend the expiration date of a listing, the best practice is to use an amendment addendum form and have it signed by the sellers and the listing agent. True or False

True Changes to the listing agreement require written consent of the sellers and the listing agent. Although it may be possible to make the change on the original listing agreement form, it is best to use and amendment addendum.

Net listings are legal in California only the agent discloses the amount of the commission before the seller becomes committed to the transaction. True or Fales

True Net listings, in which the broker keeps any portion of the sales price beyond a specified amount, are discouraged because they create an opportunity for unscrupulous brokers to take advantage oh home sellers.

The paragraph show above is an example of a safety clause. True or False

True A safety clause is also sometimes known as an extender clause or a protection clause.

A transfer disclosure statement must be used in "for s ale by owner" transactions. True or False

True The seller of a residential property with up to four units must complete a transfer disclosure statement, even if no listing agent is involved.

A broker usually finds a ready, willing, and able buyer is entitled to compensation regardless of whether the sale closes. True or False

True Under most listing agreements, a broker is entitled to compensation if she finds a ready, willing, and able buyer. A broker might decide, however, not to sue in order to collect that commission.

Open Listing

Under an open listing, a seller agrees to pay a commission only if you actually sell the property yourself. In other words, you must be the procuring cause of the sale.An open listing is not an exclusive listing. A seller may enter into open listings with multiple brokerages, only one of which will receive a commission.

Exclusive right to sell

This i the most commonly used type of listing agreement in residential transactions.

After receiving the natural hazard disclosure statement, the buyer has the same right to rescind the purchase agreement, as with the transfer disclosure statement. True or False

true The buyer may rescind the agreement within three days if the natural hazard disclosure statement is delivered personally, or with five days it it is mailed.

Title companies

have the legal description of property if your filing out form by hand and not software

Exclusive Right to Sell Listing

1) Only one broker is authorized to sell 2) the broker receives a commission no matter who finds the buyer

Lead Based Paint Disclosure

A federal requirement for residential property built prior to 1978 to use a Lead based paint and hazardous disclosure, acknowledgement and addendum form

Transfer disclosure statement

A form that notifies buyers of any physical defects to a property and requires the seller and the agent to list any evidence of defects of which they are aware, Buyers have the right to rescinded the purchase agreement within three days after the personal delivery of the transfer disclosure statement, or within five days after the disclosure statement in deposited in the mail. Notice of the rescission must be in writing.

The seller may give the buyers copies of reports from inspections of the property instead of a transfer disclosure statement. True or False

False The seller must always use a transfer disclosure statement. Inspection reports may be attached as part of the disclosures, but they do not satisfy all of the seller's obligations.

Elements of a Listing Agreement

Property description Terms of sale Broker's Authority Promise of Compensation Termination Date In writing and Signed by Seller

Natural Hazard Disclosure Statement

Seller needs to disclose if the property is on a earthquake or within hazardous flood or fire areas

Property Description

Street address is generally not enough

A listing agreement is used to spell out the contractual relationship between your broker and a home seller.

There are three main types of listing agreements: open listings, exclusive agency listings, and exclusive right to sell listings. We'll start with open listings.

The exclusive agency and exclusive right to sell listings grant one broker the exclusive right to submit offers to purchase to seller. Only the open listing allows other brokers to submit offers.

This is the only type of listing agreement that allows a seller to enter into an agreement with more than one agent.

An exclusive agency listing entitles the broker to a commission if anyone other than the seller finds a buyer for the property.

This listing requires the seller to pay a commission if any border finds a buyer for their home, but not if the seller finds a buyer on her own.

An open listing requires that an agent must be the procuring cause of the sale in order to receive the commission.

This type of listing is disfavored by brokers since no commission is owed if another broker or the seller sells the property.

A listing agreement must include a legal description or other unambiguous description of the property. True or False

True

Mello-Roos lien is created by a special assessment to provide the community services such as police or parks. True or False

True

The purpose of a safety clause is to protect you and your broker from a buyer and seller who wait to sign a purchase agreement until after the listing period expires, to avoid paying a commission. True or False

True A safety clause usually protects the broker's commission if the buyer was shown the property or mad and offer during the listing period. Th buyer and seller cannot delay the sale to avoid paying the commission.

Exclusive Right to Sell Listing guarantees the listing agent a commission so long as the property sells during the listing agreement.

Under this listing , the listing broker receives a commission regardless of where he, another broker, or the seller sells the property.

An open listing

Under this listing you must be the procuring cause of the sale in order to receive the commission.

The listing agreement should contain:

property description, basic ingredients of contract, competent parties, offer and acceptance, consideration and a legal purpose.