Agency Disclosure and duties to parties

Licensees should ensure that consumers read the __________________section of the Working with a Real Estate Broker form.

"Important Notice"

What forms agency?

- formed by a written agreement or expressed agreement where accepted actions imply an agency agreement - establishes a fiduciary relationship

listings agent's "first substantive meeting" with buyer?

- just prior to showing property - prior to electing confidential information - prior to executing any transaction agreements

What does listing agents 'first substantive meeting" with buyer exclude:

- open houses - casual conversations - responses to general questions

Buyer's agents vs sellers agents responsibilities?

-Buyers' agents are responsible for advocating for the interests of buyer clients and seeking the best price available (or a price that's acceptable to the buyer). - seller's agent: it's the licensee's duty to advocate solely for the seller and seek a sale at the best price available, or at a price that is acceptable to the seller.

Duties to Customers

1) Honesty - You must treat all customers with integrity and truthfulness. You must never deceive, mislead, or misrepresent information or facts to any party in the transaction, whether you're contracted with that person or not. 2) Disclosure - You must disclose information about transactions and properties that's vital for the parties to know in order to make informed decisions. This disclosure includes material facts that may affect the value of the property, the desirability of the property, or the parties' decisions. 3) Accounting - You must keep accurate accounting for money and personal property entrusted to your care as it relates to transactions.

The "first substantive meeting" does NOT include:

1) Showing a property to a potential buyer at an open house, as long as no confidential information about the buyer's needs, qualifications, or motivations is obtained; if confidential information is obtained at the open house, the meeting becomes "substantive" and the Working with a Real Estate Broker form must be provided 2)Engaging in a casual conversation about the property or answering general questions about the property or other properties

Two types of Dual Agency

1) Single-licensee dual agency occurs when one licensee represents both the seller and the buyer in the same transaction. 2) In-house dual agency occurs when licensees working under the same broker represent opposing sides in a transaction.

The "first substantive meeting" with buyers and sellers is the first contact with the buyer or seller or before:

1) The licensee shows the property to a prospective buyer. 2) The licensee obtains any confidential information regarding needs, qualifications, or motivation. 3) The parties sign any agreements.

Exclusive buyer rep agreement must include?

1) sale price 2) compensation 3)signatures 4) must state broker represents the buyer 5) must be in wiring 6) includes terms, conditions, under which buyer will rely on broker for purchasing property

Task performed by sellers agents?

1)Collecting and safeguarding the earnest money deposit 2)Ensuring the seller makes all required property condition disclosures 3)Negotiating contract terms in accordance with the seller's wishes 4)Reviewing transaction documents with the seller, clarifying anything that could be confusing 5)Investing time and energy in selling the property

What does the Working with a Real Estate Broker form allow for consumers?

1)Educates consumers about the types of agency relationships available, the duties owed to customers and clients, and who represents whom in each relationship. (used to disclose single and dual agency, explains relationship entails, and explains what duties broker owes client) 2)Allows consumers to choose to work with a licensee as a client or customer. 3)Isn't a legally binding contract, and doesn't create an agency relationship.

As a fiduciary for a buyer what are your task?

1)Show buyers properties that meet their criteria and fall within their budget. 2)Ensure buyers receive all required property condition disclosures from the sellers. 3)Make sure buyers understand the importance of conducting due diligence, including getting a professional inspection of the property. 4)Review transaction documents with buyers and clarify anything that could be confusing. 5)Negotiate contract terms that are fair and agreeable to the buyers.

What documents must buyer/or seller sign to disclosed dual agency?

1)The licensee must provide all parties with the Working with a Real Estate Broker form provided by MREC and get it signed. 2)The seller and buyer must both sign the Consent to Dual Agency portion of the MREC form. 3)The buyer and seller must both sign the MREC Dual Agency Confirmation form, which should be attached to the purchase contract.

Why is a single-dual agency impossible for the licensee to provide the full range of fiduciary duties to both the buyer and the seller?

1)When you act as a dual agent, confidential information about price, terms, motivation for pursuing a transaction, and previous offers must not be shared with the other party unless the party for whom the information is held authorizes you to disclose it in writing. 2)Dual agents may not advocate for one party to the detriment of the other.

Dual agents in Mississippi are prohibited from disclosing any information regarding the following:

1)Whether the seller will accept less than the asking or listed price, unless otherwise instructed to do so in writing by the seller 2)Whether the buyer will pay a price greater than the price submitted in a written offer to the seller, unless otherwise instructed to do so in writing by the buyer 3)The motivation of any party for selling, buying, or leasing a property, unless otherwise instructed to do so in writing by the appropriate party 4)That a seller or buyer will agree to financing terms other than those offered, unless otherwise instructed to do so in writing by the appropriate/responsible party

You're representing Katie in the purchase of a house. She has a trust fund and can definitely afford the house on which she's made an offer ... and then some. Which one of the following statements is true about your relationship with Katie? 1) Your duty of confidentiality to your client requires that you do NOT disclose her financial situation to the seller. 2)Your duty of disclosure to all parties requires that you disclose Katie's financial status to the seller. 3)Your duty of honesty and fairness to all parties requires that you disclose Katie's financial status to the seller. 4)Your duty of reasonable skill and care requires that you show Katie properties in a higher price range because she can afford it.

1)Your duty of confidentiality to your client requires that you do NOT disclose her financial situation to the seller. Clients are owed the duties of obedience, loyalty, disclosure, confidentiality, accounting, and reasonable skill and care. Customers are owed honesty, disclosure, and accounting.

Lisa signed an exclusive brokerage agreement with Mississippi licensee Paul. However, after a few weeks, she decided to terminate the agreement. How much notice does Lisa have to give Paul in order to withdraw from the contract?

15 days

Buyer May Withdraw from Buyer-Broker Agreement with how many days notice?

15-day notice

Mississippi licensee Adele had just arrived at the office on Saturday morning when a potential buyer who introduced herself as Jess stopped in. Jess had several printouts of properties she'd found online, and said to Adele, "I was wondering if you could take me to tour these properties I found online." What's the best way for Adele to answer? 1) "I'd love to help you, but you'll need to sign a buyer agency agreement first." 2) I'd love to help you! We'll need to discuss a few things first, though." 3) "Sure! Let's take a look at what you have and we can set up some appointments."

2) "I'd love to help you! We'll need to discuss a few things first, though." Licensees must provide and explain the Working with a Real Estate Broker form and get consumers to sign it at first substantive contact. In this case, Adele would need to provide it before showing Jess properties.

Mississippi licensee Deidre was conducting an open house for her seller clients, the Smiths. Pam and Joe, potential buyers who were looking at the Smiths' house, approached Deidre and began to ask some questions. Which one of the following statements is true? 1) A. Deidre can engage in casual conversation about the property, but can't answer any questions about it unless she provides the Working with a Real Estate Broker form. 2) Deidre can't answer any questions until they sign the Working with a Real Estate Broker form. 3) Deidre must provide the Working with a Real Estate Broker form to Pam and Joe before she obtains any information about their needs, qualifications, or motivation for buying.

2) Deidre must provide the Working with a Real Estate Broker form to Pam and Joe before she obtains any information about their needs, qualifications, or motivation for buying. (The Working with a Real Estate Broker form must be provided at first substantive contact, which is prior to obtaining any confidential information from buyers about their needs, motivations, or qualifications.)

You are representing Mark in the sale of his home, which Karen is interested in purchasing. Today you learned from a civil engineer friend that there's a very good chance a planned highway expansion will put the freeway within 50 yards of the house. In this case, the freeway expansion is considered to be which of the following? 1) Irrelevant because it hasn't happened yet 2) A material Face 3) public record 4) Confidential information related to the transaction

A material fact Information that may affect the value of a property, the desirability of a property, or the decisions of any party to the transaction is considered a material fact and must be disclosed to all involved parties, no matter which party you represent in the transaction.

who are responsible for advocating for the interests of buyer clients and seeking the best price available (or a price that's acceptable to the buyer)?

Buyer's agent

Clients vs customers are owed?

Clients are owed the duties of obedience, loyalty, disclosure, confidentiality, accounting, and reasonable skill and care. Customers are owed honesty, disclosure, and accounting.

what are two duties that survive termination of an agency agreement?

Confidentiality and accounting

What duty last forever?

Confidentially

Who are owed certain duties, though not as many as clients who have signed an agency agreement are owed?

Customers

Kirk is a Mississippi licensee who owns a rental property. If he sells the property, what is he required to do?

Disclose that he's a licensed real estate professional in any advertising and any contracts with potential buyers. (In Mississippi, licensees may act as principals in a transaction, but must disclose their license status to all other parties to the transaction.)

Which duty to clients is? The licensee must disclose any relevant information (aka material facts) pertaining to the transaction to the client. Information that may affect the value of a property, the desirability of a property, or the decisions of any party to the transaction is considered a material fact and must be disclosed to all involved parties, no matter which party you represent in the transaction.

Disclosure

Shirley, a Mississippi broker, met with Gerome, a potential buyer client, a few days ago, and Gerome signed an exclusive right-to-represent agreement with Shirley's brokerage firm. Today, Shirley received a call from Gerome stating that he'll be moving out of state and is no longer interested in buying a home in Mississippi. Which of the following is a true statement? 1) Gerome can NOT withdraw from the agreement. 2) Gerome can only withdraw the agreement if Shirley agrees in writing. 3) Gerome can withdraw from the agreement. 4) Gerome can only withdraw from the agreement if there are fewer than 30 days left on the contract.

Gerome can withdraw from the agreement. Buyers can terminate a brokerage agreement by giving written notice to the buyer's exclusive agent, and the notice must be within a specific time frame.

what document confirms broker has explained dual agency to both buyer and seller?

MREC Dual Agency Confirmation form

Which form is attached to the purchase contract?

MREC Dual Agency confirmation form

Mike was meeting with a potential seller client named Bob. He'd just discussed the Working with a Real Estate Broker form with Bob, and Bob signed it. Which one of the following is a true statement about this situation? 1) Bob is legally bound to work with Mike after he signs the form. 2) Bob is now Mike's client. 3) Mike must provide Bob with a signed copy and also retain a copy in the brokerage files. 4) Mike now owes Bob fiduciary duties.

Mike must provide Bob with a signed copy and also retain a copy in the brokerage files.

Duties to Clients

OLD CAR 1)Obedience - The licensee agrees to carry out all lawful instructions from the client. 2)Loyalty - The licensee puts the client's interests ahead of all others, including the licensee's own interests. 3) Disclosure - The licensee must disclose any relevant information (aka material facts) pertaining to the transaction to the client. 4)Confidentiality - The licensee must keep the client's information confidential (provided the agent is not legally required to disclose it). This duty lasts forever. 5)Accounting - Licensees are responsible for and must keep safe any funds or properties entrusted to them. This duty lasts until all accounting for the transaction has been completed. 6)Reasonable skill and care - The licensee must act at the utmost professional level in serving the client.

Which duty is The licensee must act at the utmost professional level in serving the client.

Reasonable Skill and Care

Specific tasks that must be performed by buyers' agents include:

Showing the buyer properties that meet their criteria and fall within their budget Ensuring the buyer receives all required property condition disclosures from the seller Reviewing transaction documents with the buyer and clarifying anything that could be confusing Negotiating contract terms that are fair and agreeable to the buyer

Who's job/ type of agency is it to advocate solely for the seller and seek a sale at the best price available, or at a price that is acceptable to the seller?

Single Seller agency

what form must be provided at first substantive contact, which is prior to obtaining any confidential information from buyers about their needs, motivations, or qualifications?

The Working with a Real Estate Broker

Obedience duty to clients

The licensee agrees to carry out all lawful instructions from the client

Reasonable Skill and Care Duty to clients

The licensee must act at the utmost professional level in serving the client.

Duty of disclosure to clients

The licensee must disclose any relevant information (aka material facts) pertaining to the transaction to the client. Information that may affect the value of a property, the desirability of a property, or the decisions of any party to the transaction is considered a material fact and must be disclosed to all involved parties, no matter which party you represent in the transaction.

is illegal, and occurs when one licensee represents both the buyer and seller in the same transaction without providing proper disclosure and getting written consent?

Undisclosed dual agency

Which document isn't a legally binding contract and doesn't create agency?

Working with a Real Estate Broker

Which form must the Mississippi licensees must provide and explain to all consumers at first substantive contact?

Working with a Real Estate Broker

If the agency relationship changes between the parties involved in a transaction, licensees must provide?

a new disclosure form to all parties.

Mary is a Mississippi licensee who is selling a home for the Andersons. The Wilkes are interested in buying the Andersons' property. Which one of the following duties does Mary owe both the Andersons and the Wilkes?

accounting

What duty to buyer last until all accounting for the transaction have been completed?

accounting

Which duty to client is Licensees are responsible for and must keep safe any funds or properties entrusted to them. This duty lasts until all accounting for the transaction has been completed?

accounting

broker authorized to act on behalf of a client/principal

agent

first substantive meeting

an encounter with a prospect that has reached the point where agency disclosure is required

Julie, a Mississippi buyer, must consent to dual agency by signing the MREC Dual Agency Confirmation form, which must be ______ the offer to purchase.

attached to

All Mississippi exclusive buyer representation agreements must?

be in writing and contain information about what services the agent will provide for the buyer.

Mississippi licensees may act as disclosed dual agents only after getting the written consent of ________ before preparing a purchase offer.

both the buyer and the seller

How can buyers terminate a brokerage agreement?

by giving written notice to the buyer's exclusive agent, and the notice must be within a specific time frame.

the principal with whom the broker has agency relationship with and owes fiduciary duties?

client

Agency

client broker relationship where agents acton behalf of client in a real estate transaction - formed by a written agreement or expressed agreement where accepted actions imply an agency agreement - establishes a fiduciary relationship

What does Dual Agency Confirmation form purpose?

confirms broker has explained dual agency to both buyer and seller

In Mississippi, licensees may act as principals in a transaction, but must?

disclose their license status to all other parties to the transaction.

In Mississippi, licensees may act as principals in a transaction, but must?

disclose their licensed status to all other parties to the transaction in any ads used to sell the property and on all contracts for the property.

is defined by Mississippi law as someone who is "representing both parties to a real estate transaction with the informed consent of both parties, with written understanding of specific duties and representation to be afforded each party."

disclosed dual agent

The Working with a Real Estate Broker form must be provided at?

first substantive contact.

an encounter with a prospect that has reached the point where agency disclosure is required

first substantive meeting

What duties are owed to clients and customers?

honesty, fair dealing (cant treat customers unfairly or dishonest)

Under which of the following circumstances is an oral disclosure of agency options allowed in Mississippi?

if the parties aren't available to sign

in what dual agency is confidential information about one party cannot be shared with the other party. However, licensees are permitted to share confidential information with their firm's principal broker. The principal broker must maintain the confidentiality of that information?

in-house dual agency

what type of dual agency occurs when licensees working under the same broker represent opposing sides in a transaction?

in-house dual agency

A disclosed dual agent

is defined by Mississippi law as someone who is "representing both parties to a real estate transaction with the informed consent of both parties, with written understanding of specific duties and representation to be afforded each party."

Undisclosed dual agency?

is illegal, and occurs when one licensee represents both the buyer and seller in the same transaction without providing proper disclosure and getting written consent. - the buyer, the seller, or both parties are unaware that the licensee is a dual agent.

With in-house dual agency, confidential information about one party cannot be shared with the other party. But who must the agent share the information with?

licensees are permitted to share confidential information with their firm's principal broker. The principal broker must maintain the confidentiality of that information.

which duty to client is he licensee puts the client's interests ahead of all others, including the licensee's own interests.?

loyalty

Information that may affect the value of a property, the desirability of a property, or the decisions of any party to the transaction is considered a ___________and must be disclosed to all involved parties, no matter which party you represent in the transaction.

material fact

what must single-license dual agency not do?

may not advocate for one party to the detriment of the other.

If the disclosure is oral bc the parties aren't available to sign what must the broker note?

must note the oral disclosure on the form, and must get the necessary signature(s) as soon as possible

What must licensee obtain at first substantive meeting?

must obtain signatures acknowledging receipt of the form at first substantive contact, provide signed copies to consumers, and retain copies in the brokerage's files.

Can a agent disclose in dual agency whether the seller will accept less than the asking listed price, unless otherwise instructed to do so in writing by the seller?

no

Can an agent disclose Whether the buyer will pay a price greater than the price submitted in a written offer to the seller, unless otherwise instructed to do so in writing by the buyer in dual agency?

no

Can an agent in dual agency disclose The motivation of any party for selling, buying, or leasing a property, unless otherwise instructed to do so in writing by the appropriate party and That a seller or buyer will agree to financing terms other than those offered, unless otherwise instructed to do so in writing by the appropriate/responsible party?

no

which duty is The licensee agrees to carry out all lawful instructions from the client?

obedience

Mississippi licensees are allowed to engage in casual conversations and answer questions at an open house without providing the form, as long as they don't obtain what from the buyers?

obtain confidential information from buyers

in-house dual agency

occurs when licensees working under the same broker represent opposing sides in a transaction. -With in-house dual agency, confidential information about one party cannot be shared with the other party. However, licensees are permitted to share confidential information with their firm's principal broker. The principal broker must maintain the confidentiality of that information.

Single license dual agency

occurs when one licensee represents both the seller and the buyer in the same transaction - it is impossible for the licensee to provide the full range of fiduciary duties to both the buyer and the seller.

Single Licensee dual agency

occurs when one licensee represents both the seller and the buyer in the same transaction.

What type of disclosure are allowed if the parties are not available to sign the Working with a Real Estate Broker form. The broker must note the oral disclosure on the form, and must get the necessary signature(s) as soon as possible?

oral disclosures

In dual agency what duties are owed an not owed?

owes same duties except full disclosure and undivided loyalty

Mississippi licensees may only act as dual agents after getting written consent from both the buyer and the seller. Consent must be received prior to?

preparing a purchase offer.

When you act as a single-license dual agent, confidential information about _____________________________________ must not be shared with the other party unless the party for whom the information is held authorizes you to disclose it in writing.

price, terms, motivation for pursuing a transaction, and previous offers

What is the next step after signing working with a real estate agent?

provide customer with a signed copy and resin a copy in the brokerage files

subagent

salesperson licensed under broker acting on behalf of a client

who Ensuring the seller makes all required property condition disclosures?

seller agent

What type of dual agency occurs when one licensee represents both the seller and the buyer in the same transaction?

single license dual agency

in what type of dual agency is it is impossible for the licensee to provide the full range of fiduciary duties to both the buyer and the seller?

single license dual agency

If first substantive contact occurs via telephone or electronic communication what must happen?

the agency disclosure can be provided orally, but a copy of the Working with a Real Estate Broker form must be provided as soon as possible to the parties so it can be signed.

If a consumer refuses to sign the Working with a Real Estate Broker form?

the licensee must indicate on the form itself to whom it was provided, the date, and a note stating that the consumer refused to sign to acknowledge receipt.

customer

transaction principle not represented by a license

t/f The Working with a Real Estate Broker form doesn't create an agency relationship, and isn't legally binding.

true

In an _________________ agency situation, the buyer, the seller, or both parties are unaware that the licensee is a dual agent.

undisclosed dual agency

buyer's agent 1st substantive meeting with seller

upon initial contact and prior to any communication with seller to listing agent

first substantive contact,

which is prior to obtaining any confidential information from buyers about their needs, motivations, or qualifications.

The Mississippi Real Estate Commission (MREC) requires that the types of available agency relationships be disclosed in ____________ to potential buyer and sellers.

writing

Is disclosed dual agency legal in MS?

yes