6 - Law of Agency and Real Estate Brokerage Flashcards
The relationship that exists when one person (the agent) acts for or on behalf of another person (the principal).
agency
The person who hires and gives authority to an agent.
the agent represents or works for the principal.
principal
Another name for the principal.
client
A relationship that is built on trust.
fiduciary
The agent has full authority to conduct business on behalf of the client.
They can sign documents and bind (obligate) the client in the same manner in which the client would do in person.
universal agency
The agent has the right to represent a principal in a particular type of transaction or business .
Example: Property manager
the property manager is primarily responsible for preserving the value of an investment property while generating income as an agent for the owners.
general agency
The most limited of all agency relationships. Also referred to as “ limited agency”. The agent May perform only limited duties for the principal. They are not able to bind the principal because he / she is not allowed to sign or accept any terms or conditions on behalf of the principal.
special agency
When a potential buyer contacts an agent for information regarding a property, he or she is a ______.
customer
When a license holder secures an agency relationship with the seller via a written listing agreement.
express authority
This type of agency is created by behavior of the parties.
For example: if a license holder behaves in a manner that makes a party reasonably believe that he or she is being represented, this type of agency relationship may have been created.
implied agency
When actions lead another person to assume that one is an agent this is called a _____ agency relationship.
ostensible agency
Occurs when an agent acts without prior authorization, and upon learning of this action, the principal accepts it.
Example: at closing, the seller is surprised to learn that he will receive one week’s rent in addition to the sales price.
agency by ratification
A single agents will represent either the buyer or the seller but not both in the same transaction.
single-agency broker
A broker that facilitates a buyer and a seller to reach an agreement and a real estate transaction, even though he / she does not have an agency relationship with either.
transactional broker
When a broker agrees to represent both the buyer and the seller, with their written permission, and a real estate transaction.
dual agency broker
Occurs when the seller retains the services of a broker.
listing side
Occurs when the buyer retains the services of a broker.
selling side
When a property is listed by one firm and later sold by another.
cooperative sale
When one firm sells a property listed by another firm to a buyer it does not represent, the selling firm represents the seller in a _____ relationship.
subagency
When a single firm sells one of its own listings.
in-house sale
An in-house sale.
The broker assigns an agent to represent the buyer and one to represent the seller.
The broker must make these appointments and writing.
intermediary with appointments
IABS
Provides consumers with necessary information regarding agency relationships with license holders. All potential parties to a transaction must be provided with the I ABS at the first substantive discussion of a possible transaction.
Information about Brokerage Services
DTPA
A Texas law that was passed in 1973 that allows an aggravated customer to sue a seller of goods for damages.
The act by the servicer of the goods has to be deceptive or unfair for the consumer to sue for monetary damages successfully.
deceptive trade practices act
When an agent has the opportunity to sell their own listing.
With their Brokers permission, the agent can go ahead and complete the transaction, but cannot give advice and or opinions to either party. Must stay neutral.
Intermediary without appointments
When an agent has the opportunity to sell their own listing.
With their Brokers permission, the agent can go ahead and complete the transaction, but cannot give advice and or opinions to either party. Must stay neutral.
Intermediary without appointments
If a broker wishes to terminate the sponsorship of a licensed sales agent, he or she must notify the agent and writing and return the agent’s license to trec immediately.
likewise, A licensed sales agent who wishes to terminate his or her association with his or her sponsoring broker must do so in writing.
If a broker wishes to terminate the sponsorship of a licensed sales agent, he or she must notify the agent and writing and return the agent’s license to trec immediately.
likewise, A licensed sales agent who wishes to terminate his or her association with his or her sponsoring broker must do so in writing.
