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Real Estate > Agency Final > Flashcards

Agency Final Flashcards

1
Q

When a client appoints someone to act in his behalf, an agency relationship is created. Which of the following is not essential to establishing an agency relationship?

  1. Competency on the part of the client
  2. Agreement of the parties to the agency
  3. A limited power of attorney
  4. Capacity of the agent
A

A limited power of attorney

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2
Q

A licensee acting on behalf of a property owner is best described as _____________

  1. a dual agent.
  2. an implied agent.
  3. ratified.
  4. a fiduciary.
A

a fiduciary.

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3
Q

In order for a broker to recover a disputed commission, he must prove _____________

  1. that he is duly licensed.
  2. that he found a ready, willing and able buyer.
  3. that he was the procuring agent.
  4. All of the above
A

All of the above

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4
Q

Real estate broker, Johnson, listed Mr. Mitchell’s home. Mr. Mitchell has accepted an offer, but the sale has not yet closed. Johnson is obligated to _____________

  1. make an effort to seek additional offers until the sale closes.
  2. submit all additional offers until the sale closes.
  3. Both 1 and 2
  4. Neither 1 nor 2
A

submit all additional offers until the sale closes.

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5
Q

Smith, a broker with ABC Realty, is the listing broker for Johnson. Smith secures an offer to purchase Johnson’s property. As he is leaving the office to present the offer, he receives a second offer from another broker, Jones, with more attractive terms but for less than the listed price. Smith should present _____________

  1. his full price offer first and present Jones offer only if his is rejected.
  2. his offer and tell Johnson there is a second offer for less than full price.
  3. both offers at the same time.
  4. only the first offer, telling Jones his offer cannot be presented since there is already a contract.
A

both offers at the same time.

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6
Q

Since the listing broker, Hansen, knows that Seller Smith will sell his home for $5,000 less than the listed price, he reveals this information to Prospective Buyer Brown and thereby _____________

  1. violates his duties to Smith.
  2. complies with the law by making full disclosure of material facts to Brown.
  3. offers a fraudulent inducement to buy.
  4. performs what is known in the real estate business as puffing.
A

violates his duties to Smith.

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7
Q

Marie Gregg acted on behalf of Tom Hilton without his authority, or even appearance of authority. At a later date, Hilton approved of her actions. Hilton’s approval of Gregg’s actions would be an example of _____________

  1. express agreement.
  2. ratification.
  3. estoppel.
  4. assumption of authority.
A

ratification.

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8
Q 
Which of the following are fiduciaries in a real estate transaction? 
I. Escrow agent 
II. Broker 
III. Buyer 
IV. Seller 
1. I and II only 
2. I and III only 
3. III and IV only 
4. I, II and IV only
A

I and II only

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9
Q

Buyer means a person who may _____________
I. execute an offer to purchase real property from a seller through an agent.
II. enter into an exclusive representation contract with an agent whether or not a sale or transfer of property results. 1. I only
2. II only
3. Both I and II
4. Neither I nor II

A

Both I and II

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10
Q

Which of the following is a duty of the agent?

  1. Completely and truthful dealings with the client
  2. Accept only those tasks which he can skillfully perform
  3. Assume full liability for any wrongful act committed or permitted by himself or his employees
  4. All of the above
A

All of the above

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11
Q

A principal real estate broker and associate brokers must _____________
I. disclose a conflict of interest in writing to all parties.
II. take no action that is adverse or detrimental to either party’s interest.
III. obey the lawful instructions of both parties.
1. I only
2. I and II only
3. I, II and III
4. None of the above

A

I, II and III

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12
Q

While holding an open house on one of her listings, a broker is asked by a prospective buyer how much the broker believes the house is really worth, and whether the sellers would take less than the asking price. How should the broker respond? 1. Tell the buyer that she is only authorized to present the property at the listed price, but that she is obligated to present any written offer the buyer would like to make.

  1. Explain to the buyer that market value is difficult to predict and is determined by the amount a buyer is willing to pay for a property and the amount a seller is willing to accept.
  2. Offer to show the buyer comparable homes that have sold recently or that are on the market presently, so that the buyer can draw his or her own conclusions concerning value and be comfortable with his or her own decision. 4. Any of the above
A

Tell the buyer that she is only authorized to present the property at the listed price, but that she is obligated to present any written offer the buyer would like to make.

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13
Q

A licensed broker _____________

  1. must only act for one party in a transaction.
  2. may act for both parties with the knowledge and written consent of both.
  3. may act for both parties if licensed for a minimum of one year.
  4. is a fiduciary and has the duty to remain neutral.
A

may act for both parties with the knowledge and written consent of both.

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14
Q

If a client instructs his agent to make certain representations concerning a property which are known to be false to both the client and the agent, and if the agent follows those instructions _____________
I. the client is liable because he explicitly authorized the misrepresentation.
II. the agent will be personally liable for the misrepresentation.
1. I only
2. II only
3. Both I and II
4. Neither I nor II

A

Both I and II

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15
Q

As an agent of the seller, a principal real estate broker is usually authorized to do all except with of the following?

  1. Cooperate with other principal brokers to affect a sale
  2. Advertise the listed property
  3. Place a “For Sale” sign on the listed property
  4. Bind the client under a sales contract
A

Bind the client under a sales contract

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16
Q

A seller’s agent would most likely breach his affirmative duty to a seller if he _____________

  1. advises the seller regarding financial matters including investment counseling.
  2. showed properties owned by other sellers to prospective buyers.
  3. listed a number of competing properties for sale in the same area.
  4. stopped advertising the seller’s property after an offer, subject to a contingency, was accepted by the seller.
A

advises the seller regarding financial matters including investment counseling.

17
Q

The amount of commission a principal broker pays his associate brokers is determined by _____________

  1. the listing agreement.
  2. local agreement of principal brokers.
  3. mutual agreement between the broker and the principal broker.
  4. the earnest money agreement.
A

mutual agreement between the broker and the principal broker.

18
Q

Confidential information means _____________

  1. information about the buyer or the seller that the buyer or the seller instructs the agent to disclose to the buyer or the seller.
  2. information communicated to a real estate agent by the buyer or seller and instructed not to disclose. 3. information the agent knows or should know failure to disclose would constitute fraud.
  3. None of the above
A

information communicated to a real estate agent by the buyer or seller and instructed not to disclose.

19
Q

A broker generally creates his or her relationship with the client by _____________

  1. ratification.
  2. an implied contract.
  3. an expressed contract.
  4. estoppel.
A

an expressed contract.

20
Q 
Saundra Miles, a licensed principal broker, was employed by Richard Burton to sell his home. Which of the following   statements would correctly describe Miles’ relationship to Burton? 
I. Miles is Burton’s agent 
II. Miles owes a fiduciary duty to Burton 
III. Miles is a general agent 
1. I only 
2. I and II  
3. II and III 
4. I, II and III
A

I and II

21
Q

An owner of property gave a listing to a principal broker. Shortly thereafter the owner died. In this case the _____________

  1. agency is immediately terminated.
  2. principal broker is entitled to his full commission from the estate.
  3. listing agreement is binding on the heirs of the deceased owner.
  4. principal broker is entitled to a reasonable time thereafter to procure a buyer during which time the listing will remain in force.
A

agency is immediately terminated.

22
Q

The buyers tell their agent that they plan to operate an accounting service out of their new home. Their agent shows them a house that has a large, private den that would make an ideal office for their business. Although he is not aware of any zoning or private restrictions that would prohibit operating an accounting service out of a home in the area, the agent would be obligated to _____________

  1. verify personally whether there are any zoning or private restrictions affecting the buyers’ intended use of the property.
  2. ask the seller and listing agent whether they are aware of any restrictions against operating a business out of the home and report back to the buyer.
  3. suggest that the buyers check on the zoning and review the restrictive covenants, if any.
  4. order a title report before the buyers even make an offer to buy the house.
A

suggest that the buyers check on the zoning and review the restrictive covenants, if any.

23
Q

A seller cannot terminate a broker’s listing agreement if the _____________

  1. broker has made attempts to negotiate a sale.
  2. broker has advertised the property.
  3. broker holds an interest in the property.
  4. owner decides to change brokers.
A

broker holds an interest in the property.

24
Q

Under Oregon statutory law, after a seller lists her property, she _____________

  1. is considered to have imputed knowledge of all facts known to her agent.
  2. has primary liability for all acts, errors and omissions of her agent.
  3. Both 1 and 2
  4. Neither 1 nor 2
A

Neither 1 nor 2

25
Q

An Oregon broker is an agent of the _____________

  1. principal.
  2. principal broker.
  3. buyer.
  4. seller.
A

principal broker.

26
Q 
The seller told the broker that termites have destroyed the floor and that the swimming pool is in violation of the city setback   requirements. Which of the following must the broker’s agent disclose to a prospective buyer? I. The condition of the floor 
II. The pool violation 
1. I only 
2. II only 
3. Both I and II 
4. Neither I nor II
A

Both I and II

27
Q

A principal broker _____________

  1. must only act for one party in a transaction
  2. may act for both parties if licensed for a minimum of one year.
  3. may act for both parties with the knowledge and written consent of both.
  4. is a fiduciary and has the duty to remain neutral.
A

may act for both parties with the knowledge and written consent of both.

28
Q

Which of the following would be considered “dual agency”?
I. Two brokers who are cooperating with each other to sell the same piece of property
II. A broker who acts for both the buyer and the seller
1. I only
2. II only
3. Both I and II
4. Neither 1 nor II

A

II only

29
Q

Real estate license law prohibits brokers from acting on their behalf without _____________

  1. the approval of the state regulatory agency.
  2. the approval of the local real estate board.
  3. full disclosure of their license status.
  4. reservations.
A

full disclosure of their license status.

30
Q

White and Brown are brokers licensed with Western Realty. Broker White listed seller Smith’s home. Broker Brown is representing buyer Holmes, who makes an offer on Smith’s property. In this situation _____________
I. Brokers White and Brown must be dual agents since they are affiliated with the same principal broker. II. The principal broker at Western Realty is the Disclosed Limited Agent.
III. White is a seller’s agent and Brown is a buyer’s agent.
1. I and II
2. II and III
3. III only
4. I only

A

II and III

Real Estate (9 decks)

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