Agency and the Practice of Real Estate

Question 1

What are the duties of being the fiduciary?

Answer 1

COLDAC

Question 2

Why do some states keep it illegal to create a dual agency?

Answer 2

Sellers want the highest price, buyers want the lowest price. Agent has inside information that could compromise the bargaining position of either the buyer or seller if revealed to the opposite party.

Question 3

What are the differences between steering, blockbusting and redlining

Answer 3

I should know this!

Question 4

What is meant by the term “Protected Class” and how does that affect your practice?

Answer 4

Race (1866)
Color (1866)
Religion (1968)
National Origin (1968)
Gender (1974)
Family Status (1988)
Disability (1988)

Question 5

Give an example of puffing versus a fraudulent statement

Answer 5

Puffing: “Best Curb Appeal”
Fraudulent: “Largest Lot on block” when it is not.

Question 6

Universal Agency

Answer 6

basically “Power of Attorney” is given to act on behalf of client

Question 7

General Agency

Answer 7

“Limited Power of Attorney” in specific and limited areas

Question 8

Special Agency

Answer 8

Agent represents the client, but not able to bind them by contract

Question 9

Subagent

Answer 9

A person to whom agency has been delegated by the principal and is

Question 10

Subagent

Answer 10

A person to whom agency has been delegated. Agents associated with a broker on the transaction

Question 11

6 Fiduciary Duties

COLDAC - Cold Air Conditioning

Answer 11

Care
Obedience
Loyalty
Disclosure
Accounting
Confidentiality

Question 12

Expressed Agency Relationship

Answer 12

A formal document is signed binding the parties to an agency relationship

Question 13

Agent for the Owner-Investor

Answer 13

Performs the services of managing property. The relationship is a general agency.

Question 14

Agent of the Seller

Agent of the Buyer

Answer 14

Broker is the special agent

Question 15

Single Agency

Answer 15

Agent represents buyer or seller, not both

Question 16

Dual Agency

Answer 16

Agent represents both buyer and seller. Illegal in many states due to conflict of interest.

Question 17

Designated Agency

Answer 17

Agents within Brokerage Firms are designated at buyer or seller agent

Question 18

Transaction or Transactional Broker

Answer 18

Agent without fiduciary duties. Represents the transaction and not the parties. Not recognized in some states.

Question 19

Fraud

Answer 19

The INTENTIONAL use of deceit to take money, property or legal rights from a person

Question 20

Negligent Misrepresentation

Answer 20

Misrepresentation by an agent through negligence or simply a mistake

Question 21

Stigmatized Properties

Answer 21

Seek broker coaching regarding disclosing. Must be disclosed in some states but not in other states.

Question 22

Terminating Agency Relationships

Answer 22

Expiration
Completion
Death
Destruction
Mutual Agreement
Breach
Operation of Law

Question 23

The Fair Housing Act 1986

Answer 23

Protected Classes:
Race (1866)
Color (1866)
Religion (1968)
National Origin (1968)
Gender (1974)
Family Status (1988)
Disability (1988)

Question 24

The Civil Rights Act of 1866

Answer 24

All persons born in the US are citizens and therefore have the right to enter into contracts, to sue, inherit, acquire and dispose of property and will have equal rights as do white citizen.

Classes protected are Race & Color

Question 25

Steering

Answer 25

Showing properties to a buyer only in areas of the market which are predominantly the same ethnicity as the prospect

Question 26

Blockbusting

Answer 26

Attempting to create panic selling by inducing owners to sell before a neighborhood changes or homes lose value

Question 27

Redlining

Answer 27

A lender who refused to lend in an area because it is populated with members of a protected class