UNIT 2 NY Real Estate

Which of the following BEST describes the relationship between broker and seller under a listing agreement?

Special agency

Which of the following offers educational seminars to create greater awareness of the duties and responsibilities that licensees owe to others?

Various real estate boards and organizations

When talking up the property a real estate licensee must take caution in assuring the customer understands which of the following?

Whether the statement is an opinion or a fact

When retained by the buyer, the broker owes a prospective seller

A fair and honest dealing

To successfully sue a real estate agent for misrepresentation based on the agent's misstatement, a customer

does not have to show that the agent made the misstatement intentionally.

Once a brokerage relationship (agency) has been established, brokers owe the principal a host of duties, including the

exercise of care

The MOST common way of creating an agency relationship is through an

express agreement

The party paying the broker's commission

has nothing to do with the agent's disposition of agency duties.

Which of the following would terminate a listing agreement prior to its expiration date? A counter offer, death of a salesperson, a transaction that falls through, or incompetent parties

Incompetent parties

Which of the following would BEST be representative of a general agent? A) An appraiser performing an appraisal B) A property manager for an apartment complex C) A broker under a listing agreement D) An apartment sharing agent

B) A property manager for an apartment complex

All of the following are the three categories of agent relationships EXCEPT A) universal agent. B) licensed agent. C) special agent. D) general agent.

B) Licensed agent

A principal/client can be all of the following EXCEPT A) a buyer. B) a landlord. C) a tenant. D) the seller's attorney.

D) The seller's attorny

A licensee must perform which of the following for a customer,? A) Loyalty B) Confidentiality C) None of these D) Utilization of reasonable care and skill

D) Utilization of reasonable care and skill

Which of the following BEST describes a licensee representing both parties in the same transaction?

Dual agency

If an agent says, "ABC Realty is coming into town, let's not do business with them, maybe they will go away," it is an example of which of the following?

Group Boycotting

In the spirit of cooperation, a broker approached two other community brokers and recommended that they set standard fee schedules and commission rates. This recommendation is

illegal under any circumstances.

An agency agreement created by the actions of the parties, rather than by words that state than an agreement is being made, is BEST described as

implied agency.

For a broker or salesperson to have committed fraud, the broker or salesperson must have engaged in misrepresentation that is

intentional

Under a fiduciary relationship, when agents find themselves working for no compensation, the

interests of the principals come before considering themselves.

One of the MOST common complaints against real estate agents is that of

misrepresentation

The duty of obedience requires following

only the legal and reasonable instructions of the principal.

When competing brokers get together to set commission rates, rather than letting competition in the open market establish those rates, this is known as

price-fixing

The agent is hired by the

principal.

Statements that exaggerate a property's benefits are called

puffing

An after-the-fact acceptance of a relationship or previous agreement is BEST described as

ratification

The Sherman Act prohibits any kind of contract, combination, or conspiracy in

restraint of trade.

In each agency relationship, the agent owes the principal

six fiduciary responsibilities.

Real estate licensees of the broker are always

subagents of the broker's principal.

Contracts are commonly created to

suit the purpose of the parties to that contract.

A house was purchased in 1950 for $4,500. The seller knows that properties have appreciated and asks the broker to try to sell it for $100,000. The broker knows the value could be more than $200,000. The broker should

tell the seller that the house is worth much more.

Destruction or condemnation of the property

terminates the listing agreement

A general agent

the ability to bind his principal. As is usually prescribed in a management agreement, a managing agent can perform emergency repairs without advance permission of the property owner.

The broker acts as

the agent of the principle

To successfully sue a broker for misrepresentation, the buyer must be able to prove that

the buyer was damaged from relying on the truth of the statement.

Fair and honest dealing means that

the licensee will not intentionally defraud the customer.

Even with a preclusive clause in the listing agreement, brokers are usually entitled to a commission even when the transaction is not completed if

the owners change their mind and refuse to sell after the creation of the meeting of the minds.

The broker sponsored licensees (salespersons and associate brokers) are agents of

the principle sponsoring broker

Unless a listing agreement states otherwise, commissions usually are earned when

the seller accepts the buyer's offer without conditions.

Even if a proposed transaction does not go through, the broker sometimes may collect a commission if

the seller commits willful default and backs out.

In the eyes of the law, the individual licensee is considered an expert and as such must

use reasonable care in the disposition of her duties.

A ready, willing, and able buyer is one who

will buy on the seller's terms, is financially capable, and is prepared to perform.

The scope of authority granted an agent

will determine which of the three types of agent categories that relationship falls under.

A relationship of trust and confidence is BEST described by

Law of Agency

In any real estate brokerage agency relationship, who works directly for the seller, buyer, landlord, or tenant?

Solely the principal/representative broker

The broker's compensation is specified in all of the following EXCEPT A) an estoppel agreement. B) the listing agreement. C) a commission agreement. D) the management agreement.

A) an estoppel agreement

A written listing agreement is BEST described as

An express agency

The business of bringing buyers and sellers or landlords and tenants together in the marketplace in order to conclude a real estate transaction and in expectation of a fee is known as which of the following?

Brokerage

An acronym to help remember the fiduciary duties of a broker is

CC-LOAD

What are the agent's responsibilities to the principle?

Care, Confidentiality, Loyalty, Obedience, Accounting, Disclosure

A customer is the party that hires the agent and acts as the agent's principal. TRUE or FALSE?

FALSE

A dual agency occurs in a transaction when the brokerage has a customer and a client. TRUE or FALSE?

FALSE

Express contracts are contracts that are ALWAYS and only in writing. TRUE or FALSE?

FALSE

Which fiduciary duty dictates that an agent must always place the principal's interests above those of all other persons, including the agent's own interests?

Loyalty

A seller signed a 120-day listing with ABC Realty. After 60 days, the seller decided not to sell. He told ABC Realty that he no longer wanted to market his house. When is the agency of ABC Realty terminated?

On the 61st day

Who is at greatest risk of being charged with an agency law violation?

Real estate agents

A listing may be terminated when either broker or principal goes bankrupt. TRUE or FALSE

TRUE

Agency is the fiduciary working relationship that is created between the principal and the agent. TRUE or FALSE?

TRUE

Early termination of an agency agreement may be decided upon through mutual agreement between a broker and his principal? TRUE or FALSE

TRUE

It is legal for a broker to accept compensation from both parties to a real estate transaction when the arrangement is fully disclosed to all interested parties and informed consent is obtained by the broker. TRUE or FALSE?

TRUE

The manager of a property managed on behalf of the property owner is operating as a general agent? TRUE or FALSE?

TRUE

The relationship between a listing broker and a seller falls under a special agent relationship. TRUE or FALSE?

TRUE

Walking into a restaurant and sitting down is an example of an implied contract. TRUE or FALSE?

TRUE

In recent years, which of the following has changed the face of the real estate business for real estate agents?

The law of agency

Who usually compensates the broker under a listing agreement with a commission or fee for having successfully performed the service for which the broker was employed?

The seller

As it relates to antitrust violations, a conspiracy means

Two or more persons acting in a manner that would negatively impact competition

Under dual agency, the two clients give up the duty of

Undivided loyalty

Which of the following agency categories gives the broadest scope of authority to the agent? A) General agency B) Special agency C) Universal agency D) Agency coupled with an interest

Universal Agency

A seller's willingness to accept a buyer's offer for a lot only if the buyer will purchase property insurance from the seller's insurance brokerage is an example of

a tie-in arrangement.

The duty to report the status of all funds belonging to others that are entrusted to their possession is known as

accountability

The party that transacts on behalf of the principal is the

agent

If a seller contracts with a broker to market the seller's real estate, the

broker becomes an agent of the seller.

A meeting of the minds occurs when the

buyer and the seller agree on the price and terms of the sale.

A buyer who contacts the broker to review properties listed with the broker's firm is the broker's

customer

The third party with whom the agent deals on behalf of her principal is the

customer.

A broker does not think that the seller will seriously consider an offer he received for 20% less than the listing price. The broker

is required to submit the offer to the seller.

Real estate agents can be held liable for misrepresentation if they

knew or should have known a statement was false.

The duty that dictates an agent must ALWAYS place the principal's interests above those of all other persons, including the agent's own interests is the duty of

loyalty

The statement, "Why don't we draw an imaginary line down the center of town, and I won't do business in your area if you don't do business in my area," is an example of

market allocation.

A seller who wishes to cancel a listing agreement in New York

may be held liable for damages by the broker.