Buyers Agency
Advantages to exclusive buyer agency:
1. By being exclusive to buyers, licensees reduce the chances of accidentally ending up representing both the buyer and seller in a transaction. 2.Exclusive buyer's agents are specialists in dealing with buyers, meaning that this kind of broker will have specific experience with buyers and will have strategies and skills that cater to the needs and desires of buyers.
Benefits for the Agent
1. client loyalty 2. avoiding conflicts of interest 3. liability issues
A non-exclusive/not for compensation buyer-broker agreement has two main features:
1. the broker under this kind of buyer-broker agreement is not the only broker that the buyer can utilize for real estate services 2. the buyer is not obligated to pay compensation
Specific benefits of a buyer:
1.Contracts Designed for the Buyer 2. Access to the Marketplace 3. Negotiations 4. Fiduciary duties 5. Counseling
A real estate licensee is obligated to provide which of the following on a property when negotiating a listing? Both of these are correct Neither of these are correct A broker price opinion A comparative market analysis
Both of these aare correct
Which of the following is one of the primary forms of real estate agency in Texas?
Buyer's agency
A buyer who is a party to a buyer-broker agreement will usually have the following duties:
Cooperate with the broker Consider each home that is presented Read any and all important documents (e.g., buyer's inspection advisory)
The buyer-broker agreement will normally charge the broker with the following duties:
Find properties that the buyer may be willing to purchase Review paperwork Prepare Purchase Offers Conduct a visual inspection of properties the buyer is interested in buying
Which of the following is not a common way in which the buyer's commission can be paid? Paid by the buyer Paid by the financial institution financing the transaction Paid through a retainer fee Paid by the seller
Paid by the financial institution financing the transaction
When setting up a buyer representation agreement, the licensee must make sure that he or she does not do which of the following?
Promise to do things that are outside their area of expertise
One to Four Family Residential Contract (Resale) is a:
purchase contract, this statement is a disclosure
Buyers are not required to be _ by a licensee when looking for property to buy.
represented
For buyers, the relationship with a licensee provides access to:
resources and expertise that can vastly improve a buyer's chances of acquiring a property at a good price and with favorable terms.
A subagent for a seller is a representative of the:
selling party who works with the buyer
A non-exclusive right to represent buyer-broker agreement is:
similar to a non-exclusive/not for compensation buyer-broker agreement since both types of agreement do not bind the buyer to only use the services of the broker who is under the agreement establishes commission payment for services provided by the broker attached to the agreement even if the buyer does not use that broker for the final sale.
A broker representing a buyer has the ability to bring on another broker as a:
subagent
All real estate contracts (with the exception of property management contracts) are required to contain a...
termination date
Exclusive buyer representation agreements are used for the same reasons as exclusive listing agreements:
to ensure that a client's business will not be stolen by another licensee.
As a buyer agent, your client should always get the building inspected. In cases where there is no seller's disclosure, the reason is obvious. Even in cases where there is a seller's disclosure, the seller may have not known about a particular problem or may have lied about it.
true
Technically, an agency relationship is not needed to assist a buyer during a transaction
true
One mistake is to define an agency relationship by:
who pays the commission
A buyer's agent:
works for the buyer and owes fiduciary duties to that buyer
For a similar reason to why it is important to have a written agreement with a client that establishes the payment of commission, any arrangements to split commission fees should be made in:
writing
The primary benefit, of course is the payment of commission that the licensee gains for providing services to the buyer.
True
Fee Paid by the Seller:
Under this arrangement, the seller directly pays the buyer agent's commission fee or the listing agent is authorized by the seller to split his or her commission with the buyer agent. The splitting of the listing agent's commission is one of the most common fee arrangements in transactions of residential properties.
The buyer representation agreement is the common way for a buyer's agent to:
arrange for the payment of commission
Written contracts creating buyer's agency relationships carry the advantage of:
being usable in court proceedings to enforce a provision of the contract
TRELA, in Section 1101.652, states that a:
broker's or sales agent's license can be suspended or revoked if a licensee does not disclose property defects he or she knows about to a buyer.
A broker involved in a buyer's agency relationship and any licensees that are associated with that broker are all considered representatives of the:
buyer
The separation between the licensees representing the buyer and the seller means that the:
buyer's agent cannot be held liable for acts committed by the seller, the seller's agent, or any licensees affiliated with the seller's agent.
Licensees are required to:
clearly disclose to all other parties to a transaction whom the licensee represents. This disclosure must be made when the licensee first has contact with the other parties.
buyers would be _ involved in buyer representation agreements when the listing for the property in which they are interested is held by a different brokerage.
clients
All real estate contracts (with the exception of property management contracts) are required to:
contain a termination date
When the listing for the property the client is looking to buy is held by that same brokerage, then the buyer with whom they are working would then be a _
customer
All buyer-broker agreements will:
define the authority of each party, set how long the agreement will be in force, and describe the property the buyer is looking for.
Section 1101.652 of TRELA allows TREC to:
discipline a licensee for failing to identify that the person who was responsible for a real estate advertisement is a licensee.
If the broker who signs onto a buyer representation agreement is already party to a listing contract, a _ situation will result
dual agency
Additional provisions in tenant representation agreements can include any of the following:
dual agency disclosure previous agency disclosure disclosure of lead-based paint meditation provision limiation of liability
Buyers setting up buyer representation agreements with brokers have some freedom in crafting the contract to meet their:
needs
A person may _ maintain an action in this state to recover a commission for the sale or purchase of real estate unless the promise or agreement on which the action is based, or a memorandum, is in writing and signed by the party against whom the action is brought or by a person authorized by that party to sign the document.
not
Under Section 535.154 of the rules of TREC, brokers are the:
party responsible for ensuring that any advertising made by licensees affiliated with the broker is in accordance with the laws and rules governing advertising.
A brokerage can also _ how they present listings to potential buyers.
prioritize
Another method for avoiding conflict of interest is for the broker to create a:
priority system.Whichever party signs a contract with the broker first would become the party being represented. The other party would need to seek representation with another broker or pursue the transaction on their own.
A person may not maintain an action to collect compensation for an act as a broker or sales agent that is performed in this state unless the person alleges and proves that the person was:
(1) a license holder at the time the act was commenced; or (2) an attorney licensed in any state.
Notwithstanding any other law, a license or certificate holder who completes a contract form for the sale, exchange, option, or lease of an interest in real property incidental to acting as a broker is not engaged in the unauthorized or illegal practice of law in this state if the form was:
(1) adopted by the commission for the type of transaction for which the form is used; (2) prepared by an attorney licensed in this state and approved by the attorney for the type of transaction for which the form is used; or (3) prepared by the property owner or by an attorney and required by the property owner.
The commission shall suspend or revoke the license or certificate of registration of a license or certificate holder who is not a licensed attorney in this state and who, for consideration, a reward, or a pecuniary benefit, present or anticipated, direct or indirect, or in connection with the person's employment, agency, or fiduciary relationship as a license or certificate holder:
(1) drafts an instrument, other than a form described by Section 1101.155, that transfers or otherwise affects an interest in real property; or (2) advises a person regarding the validity or legal sufficiency of an instrument or the validity of title to real property.
The commission may suspend or revoke a license issued under this chapter or take other disciplinary action authorized by this chapter if the license holder:
(1) engages in misrepresentation, dishonesty, or fraud when selling, buying, trading, or leasing real property in the name of: (A) the license holder; (B) the license holder's spouse; or (C) a person related to the license holder within the first degree by consanguinity;
A license holder is not liable for a misrepresentation or a concealment of a material fact made by a party to a real estate transaction unless the license holder:
(1) knew of the falsity of the misrepresentation or concealment; and (2) failed to disclose the license holder's knowledge of the falsity of the misrepresentation or concealment.
A party is not liable for a misrepresentation or a concealment of a material fact made by a license holder in a real estate transaction unless the party:
(1) knew of the falsity of the misrepresentation or concealment; and (2) failed to disclose the party's knowledge of the falsity of the misrepresentation or concealment.
A party or a license holder is not liable for a misrepresentation or a concealment of a material fact made by a subagent in a real estate transaction unless the party or license holder:
(1) knew of the falsity of the misrepresentation or concealment; and (2) failed to disclose the party's or license holder's knowledge of the falsity of the misrepresentation or concealment.
No real estate license holder shall inquire about, respond to or facilitate inquiries about, or make a disclosure of an owner, previous or current occupant, potential purchaser, lessor, or potential lessee of real property which indicates or is intended to indicate any preference, limitation, or discrimination based on the following:
(1) race; (2) color; (3) religion; (4) sex; (5) national origin; (6) ancestry; (7) familial status; or (8) disability. (b) For the purpose of this section, disability includes AIDS, HIV-related illnesses, or HIV infection as defined by the Centers for Disease Control of the United States Public Health Service.
For purposes of §1101.652(a-1)(1) of the Act "license holder" includes a license holder acting on behalf of:
(1) the license holder's spouse, parent or child; (2) a business entity in which the license holder is more than a 10% owner; or (3) a trust for which the license holder acts as trustee or of which the license holder or the license holder's spouse, parent or child is a beneficiary.
The Real Estate License Act forbids which of the following with regard to advertising?
Advertising that is purposefully deceptive
Fee Paid by the Buyer:
Its another common way to secure commission for the buyer agent. The buyer agent can charge an hourly fee that is not contingent on what kind of property is being purchased or whether the buyer purchases a property or not. On the other hand, the buyer agent can base the commission fee on a percentage of the selling price of the property that the buyer is acquiring.
Subagency is _ restricted to sellers agents
NOT
Notwithstanding Section 1101.801, a person is not civilly or criminally liable because the person failed to inquire about, make a disclosure relating to, or release information relating to whether a previous or current occupant of real property had, may have had, has, or may have AIDS, an HIV-related illness, or HIV infection as defined by the Centers for Disease Control and Prevention of the United States Public Health Service.
TRUE
True or false: a non-exclusive right to represent buyer-broker agreement does NOT require the buyer to pay commission to the broker for services rendered if covered by the seller.
TRUE
Who does a buyer representation agreement drafted by a sales agent belong to?
The broker who sponsors that sales agent
Procuring Cause:
The licensee who procures cause is the licensee who is determined to have done the most to cause a property to be sold.
Normally, a tenant representation agreement will contain the following items:
The term of the agreement Information on the prospective tenant and the broker A thorough description of what the prospective tenant is looking for and the geographic region where the broker should be looking The obligations and duties of the broker and the prospective tenant The broker's commission and other fees paid to the broker
One manner of compensating a broker can come from an:
advance fee paid by the buyer (also called a retainer or a retainer fee).The advantage of this is that it can ensure that a buyer will follow through with the transaction.
An exclusive right to represent buyer-broker agreement:
establishes that the broker, under this agreement, is the only broker the buyer will employ while going through the property purchasing process requires commission to be paid to the broker. As with a non-exclusive right to represent buyer-broker agreements, the commission can be negotiated and it can be paid by either the buyer or the seller. is the most advantageous for the broker since he or she not only is guaranteed commission but is also guaranteed to be involved in the entire property purchasing process.
A buyer agency relationship can be created by all the same methods as a seller's agency relationship:
express contract or agreement, implication, or an operation of law.
The commission may suspend or revoke a license issued under this chapter or Chapter 1102 or take other disciplinary action authorized by this chapter or Chapter 1102 if the license holder:
fails to specify a definite termination date that is not subject to prior notice in a contract, other than a contract to perform property management services, in which the license holder agrees to perform services for which a license is required under this chapter;
A broker and buyer who want to work on an unofficial basis can form a:
general written agreement describing the parameters of their relationship
Brokers who are in agency relationships with buyers primarily attempt to:
get the lowest purchase price for their clients
A one-time representation agreement:
is a contract that creates an agency relationship between a licensee and a seller or buyer, but the relationship only applies to one transaction with one specific buyer or property. is commonly used for sellers who don't want to get tied into a longer term relationship with a broker. This kind of agreement also can be used for buyers who plan on purchasing a specific property.
Exclusive buyer agency:
is a situation where a broker or a brokerage only takes buyers on as clients is uncommon since the majority of brokers offer services to both buyers and sellers
The split of commission:
is commonly determined by a contractual agreement between the brokers involved in the transaction.
A tenant representation agreement:
is very similar to a buyer-broker agreement. can be exclusive or non-exclusive, meaning that, depending on the agreement, the prospective tenant may be able to use the services of multiple real estate brokers or may be required to employ only one broker. In this case, the broker is representing a party that is looking to establish a rental or lease rather than purchase a property.
Buyer Brokerage Agreement
its an agency relationship that involves the real estate agent or firm acting as an agent representing the buyer in negotiating for the purchase of a property
Buyer Representation Agreement
its established between a broker and a buyer belongs to the brokerage
Commission is one of the _ issues a real estate licensee must deal with who pays commission and to whom.
largest
The buyer's agent owes the buyer the duties of:
loyalty, performance, obedience, accounting, confidentiality, and disclosure; the same set of fiduciary duties that are owed to sellers by seller's agents.
