Pennsylvania Real Estate Practice Chapter 4 - Agency Law

Dwayne is a real estate salesperson who represents the buyer in a deal on a property that closes for a million dollars. The seller's broker has a listing agreement for 4%. The seller's broker has a 60/40 split with the buyer's broker. Dwayne has a 50/50 split with his sponsoring broker. How much will Dwayne make on this deal?

$8,000 (Dollars)

Selena is a licensed real estate broker. Her mother is moving into a nursing home. Her mother asks Selena to deal with the house she owns. The mother doesn't want to have to make any decisions regarding the house. She wants Selena to decide whether it makes more sense to sell or rent the home, to hire movers, sell or dispose of any left furniture and choose how best to invest any profits from a sale or rental. What type of agent is Selena when she is representing her mother in carrying out these duties?

A universal agent.

What is the difference between a subagent and an agent?

An agent is authorized by a principal to represent them; a subagent is authorized by an agent to represent the principal the agent represents.

Pace Walker is the buyer's broker for Ellen Rigby. After a recent showing, Pace finds out that crime rates have doubled in the last five years and that traffic noise from the highway is clearly audible from within the home. When Ellen asks about property values, Pace not only answers her question, but shares what he knows about crime rates and traffic noise as well. Ellen decides to keep looking. What duty has Pace fulfilled?

Disclosure

Which term is NOT an example of how an agency relationship can be created in real estate?

Double agency

If a broker represents both the seller and buyer, they operate as a ................agent.

Dual

An agency relationship in which the agent acts concurrently for both of the principals in a transaction is known as a/an...?

Dual agency

Ideally, which is the best kind of agency relationship to enter into?

Express agency

A property manager operates as a ..............agent.

General

Lionel is a real estate broker who signs a listing agreement with Rachel to sell her house. The listing agreement contains the marketing plan, the listing price, the listing expiration, and the commission as well as other pertinent information. Before showing any prospective buyers the house, he always gives the customer a consumer notice that states that he represents the seller of the house as the principal, and does not represent the customers. Which two things are true about Lionel's agency relationship with Rachel?

He is a special agent and a single agent.

Which is true about commissions on sales...?

It is always negotiable.

In real estate, which type of contract is the most common way to establish agency relationships?

Listing Contract

Remy Pascal is a broker representing seller Carl Smith. Remy decides that the property is a great candidate for a quick flip and makes an offer on the home. Immediately after purchasing the home, Remy resells it for a profit. In this case, Remy has not acted appropriately to safeguard Carl's interest above his own. Which fiduciary duty has Remy violated?

Loyalty

What does the acronym OLDCAR stand for?

Obedience, Loyalty, Disclosure, Confidentiality, Accounting and Reasonable Care

An agent with limited authority to act on behalf of the principal, such as created by a listing contract, is known as a/an...?

Special agent

A person upon whom the powers of an agent have been conferred, not by the principal, but by an agent as authorized by the agent's principal is known as a/an?

Sub-agent

Why are implied agency relationships so bad for real estate brokers?

They risk losing out on commission.

Which of the following is an example of express agency?

Tory is a real estate broker who has just signed an exclusive listing agreement with Jon to sell his house. Why? : An agency relationship that is created using a written listing agreement is an example of express agency. An express agency relationship is created by an oral or written agreement between the principal and the agent.

Which is true of a single agent?

When they represent a principal, they do not represent any other principals who have competing interests.