Intermediary Brokerage

In-house sale

A transaction in which a broker is on both the listing and selling side

Explain how a typical intermediary relationship is created and how it would operate..

At the first substantive dialogue with a seller/buyer, the salesperson provides the parties with a copy of the statutory information about the agency. Then, the brokerage firm would negotiate a written listing contract with a seller and a buyer's representation agreement with a buyer. This is where the broker will obtain the authorization of acting as an intermediary.

which of the following is true regarding Intermediary rules for a transaction? a) the transaction must be an in-house sale b) both sides of the transaction must be clients of the broker c) the broker must have written consent from both parties d) all of these are correct

D

In what ways do the Representation Provisions prohibit or permit disclosed dual agency?

Disclosed dual agency is not specifically addressed in the Act. Since disclosed dual agency is not prohibited, licensees may, with appropriate disclosure and consent of the parties, act as dual agents.

What is the advantage for the broker in acting as an intermediary?

If the broker and associates are going to continue to work with parties they have been representing under listing contracts or buyer representation agreements, the intermediary role is the only statutorily addressed vehicle for handling "in-house" transactions, providing both parties the same level of service.

Broker Steve, having no agents, is a solo practitioner. He has a client buyer that wants to purchase one of his listings. The process that Broker Steve must use is:

Intermediary Without Appointments

Can there be two intermediaries in the same transaction?

No

Does the TREC encourage brokerage companies to act for more than one party in the same transaction?

No

May he same salesperson be appointed by the intermediary to work with both parties in the same transaction?

No; the law requires the intermediary to appoint different associated licensees to work with each party.

Intermediary with appointments

Occurs when a broker appoints associates within a brokerage firm to represent the listing and selling side of a transaction

Intermediary without appointments

Occurs when an agent sells his or her own listing, but cannot give advice or negotiate for either party

One of the the persistent issues is non-residential transactions is the tendency to use _______________ on both sides of the transaction?

Oral agreements

Senate Bill 489

The legislation that gave the industry the Intermediary process

Dual Agency

The practice that allows a real estate firm to represent both the buyer and seller with their written permission

If a salesperson or associated broker lists a property and has also been working with a prospective buyer under a representation agreement, how can the salesperson or associated broker sell this listing under the Representation Provisions?

There are three alternatives for the brokerage firm and the parties to consider: 1) the firm could represent one of the parties and work with the other party as a customer rather than as a client. 2) if the firm has obtained permission in writing from both parties to be an intermediary and to appoint licensees to work with the parties, the salesperson or associated broker could be appointed by the intermediary to work with one of the parties.

Must the intermediary broker furnish written notice to each party to a transaction when the broker designates the appointed licensees?

Yes

Is an intermediary an agent?

Yes, but the duties and obligations of an intermediary are different than for exclusive, or single, agents.

What is the difference between a dual agent and an intermediary?

a dual agent is broker who represents two parties at the same time in accordance with common law obligations and duties. An intermediary is a broker who negotiates the transaction between the parties subject to the Representation Provisions of the Act.

It is illegal in Texas for a broker to be on both the listing and selling side of a transaction

false

The broker has no duty to inform the client of the intermediary relationship as it is assumed in Texas. a. True b. False

false

a cooperative sale is one which a brokerage firm sells its own listing

false

according to Texas real estate laws, a broker must always appoint associates in an intermediary relationship

false

intermediary without appointments requires that the broker sponsor at least two agents

false

The ____________ notifies the parties that both the seller and buyer are clients of the broker

intermediary relationship notice

May an intermediary appoint a subagent in another firm to work with one of the parties?

subagency is still permitted under the law, but a subagent in another firm cannot be appointed as one of the intermediary's associated licensees under the Representation Provisions of the Act.

Is disclosure of agency required to be in writing?

the disclosure may be oral or in writing

What are the agency disclosure requirements for real estate licensees?

to disclose their representation of a party upon the first contact with a party with a party or a licensee representing another party.

The Intermediary process make it possible to bring client buyers and sellers together while at the same time representing their best interests

true

To appoint associates or not in an in-house transaction is at the discretion of the broker. a. True b. False

true