Agency & It's Responsibilities Chapter 4

Question 1

What are the 5 forms that are referred to as the “Listing Package”?

Answer 1

1. Disclosure Regarding Real Estate Agency Relationship (AD)
2. Possible Representation of More Than One Buyer or Seller Disclosure and Consent (PRBS)
3. Wire Fraud & Electronics Funds Transfer Advisory (WFA)
4. Residental Listing Agreement (Exculsive Authorization and Right to Sell) (RLA)
5. Seller’s Advisory (SA)

Question 2

(BLANK) is the authority to act in place of a principal (who empowers an agent) to do a specified act for a stated period of time.

Answer 2

AGENCY

Question 3

An (BLANK) is one who acts for and with authority from the principal to represent the principal in dealing with third parties.

Answer 3

AGENT

Question 4

A (BLANK) (CLIENT) is a person who hires and authorizes an agent to work for himor her.

Answer 4

PRINCIPAL

Question 5

A (BLANK) is the other person in a contractual negotiation, other than the principal or agent.

Answer 5

THIRD PARTY

Question 6

A (BLANK) FIDUCIARY is a person acting in a position of trust and confidence in a business relationship.

Answer 6

FIDUCIARY

Question 7

Agents of the parties must disclose (BLANK) , which are facts that are so important that failure to disclose them may affect financial decisions of the parties to the transaction.

Answer 7

MATERIAL FACTS

Question 8

What are the 4 ways to create an agency relationship?

Answer 8

1. Express or Written Authority (written contract/agreement)
2. Implied Authority
3. Authority by Estoppel
4. Ratification of Unauthorized Acts

Question 9

(BLANK) is created by the contract of the principal which completely andprecisely delineates those activities which the agent is authorized to undertake.It is the only way to guarantee earning a commission without going to court.

a way to create a real estate relationship agency

Answer 9

EXPRESS AUTHORITY

Question 10

(BLANK) is the authority that a third person reasonably believes an agent possesses because of the acts or omissions of the principal.

a way to create a real estate relationship agency

Answer 10

IMPLIED AUTHORITY

Question 11

ESTOPPEL prohibits the principal from denying that a person is his or her agent if theprincipal has misled another to his prejudice into believing that person is the agent.

a way to create a real estate relationship agency

Answer 11

ESTOPPEL

Question 12

(BLANK) is approval (confirmation) of a transaction which has already taken place. Occasionally, a person may act as agent without any authority to do so, or the agent mayact beyond the scope of the agent’s authority. The alleged principal may not be bound by such acts. A principal may under certain circumstances ratify the acts of the agent and thusbecome bound.

a way to create a real estate relationship agency

Answer 12

RATIFICATION

Question 13

The first 3 steps of agency disclosure are:

Answer 13

1. Disclose
2. Elect
3. Confirm

Question 14

What form does a buyer not need to fill out from the “Listing Package”

Answer 14

Seller’s Advisory

Question 15

What does the form “Disclosure Regarding Real Estate Agency Relationship” (AD) state:

1 of 5 forms apart of the “Listing Package”

Answer 15

When you enter into a discussion with a real estate agent regarding real estate transaction you should from the outset understand what type of agency relationship or representation you wish to have with the agent in the transaction.

Question 16

What does the form “POSSIBLE REPRESENTATION OF MORE THAN ONE BUYER OR SELLER - DISCLOSURE AND CONSENT (PRBS)” state:

2nd of 5 forms apart of the “Listing Package”

Answer 16

The Possible Representation of More Than One Buyer or Seller - Disclosure and Consent (PRBS) form is given to the seller by the broker (who may be a corporation, partnership, or sole proprietorship) to inform the seller that the broker may represent more than one buyer or seller at the same time.

Question 17

What does the form WIRE FRAUD AND ELECTRONIC FUNDS TRANSFER ADVISORY (WFA) state:

Answer 17

The ability to communicate and conduct business electronically is a convenience and reality in nearly all parts of our lives. At the same time, it has provided hackers and scammers new opportunities for their criminal activity. Many businesses have been victimized and the real estate business is no exception. This form goes on to warn sellers to exercise “extreme caution,” particularly concerning emails attempting to induce fraudulent wire transfers, or illicit personal financial information.

Question 18

A (BLANK) is a contract to employ a broker as an agent, to do certain things for the owner/seller. It is an employment contract for personal service.

Answer 18

LISTING

Question 19

What are some things that should be included in your RESIDENTIAL LISTING AGREEMENT (Exclusive Authorization and Right to Sell) (RLA) agreement.

Answer 19

A listing agreement should identify the property to be sold or leased. The street address is generally useful, but it may not be enough to identify the property with certainty. This usually isn’t an issue, but it can become one if the client decides not to sell and tries to avoid paying a commission. It’s good practice to attach a legal description of the property to the contract as an exhibit. You should also include a SAFETY HARBOR CLAUSE.

Question 20

A (BLANK) in a listing is a negotiated period (any agreed to time period) after the termination of a listing in which the listing broker may still be entitled to a commission.

Answer 20

SAFETY CLAUSE

Question 21

What are the 5 different types of residental listing agreements?

Answer 21

1. EXCLUSIVE RIGHT TO SELL
2. OPEN LISTING
3. EXCLUSIVE AGENCY LISTING
4. NET LISTING
5. OPTION LISTING

Question 22

A (BLANK) in real estate is a fee paid, usually as a percentage of the selling price, to a broker/agent as compensation for his or her services.

Answer 22

COMMISSION

Question 23

A broker or his or her salesperson must be the (BLANK) of a sale to earn a commission. (BLANK) is defined as a series of unbroken events that lead to an acceptable agreement with the seller.

Answer 23

PROCURING CAUSE

Question 24

What is the Transfer Disclosure Statement?

Answer 24

It identifies items of value attached to the structure or land and states whether these items are operational. It also asks the seller to identify any structural or material defects.

Question 25

What does the Agent Visual Inspection Disclosure (AVID) include?

Answer 25

The AVID form includes “reasonably competent and diligent visual inspection of the property to disclose to the buyer all facts materially affecting the value or desirability of the property that a visual investigation would reveal.”

Question 26

What is commingling?

Answer 26

COMMINGLING is the mixing together of the funds of a principal and a licensee

Question 27

What is conversion?

Answer 27

CONVERSION is the unlawful misappropriation and use of a client’s funds by a licensee.

Question 28

What does a TRANSACTION FILE hold?

Answer 28

A TRANSACTION FILE is the file or folder (all documents) kept for three years by the broker for each real estate transaction in which the broker or his or her salespeople participated

Question 29

What is a power of attorney?

Answer 29

A POWER OF ATTORNEY is an acknowledged, written authorization of one person to act for another.

Question 30

What are the 3 types of MISREPRESENTATIONS?

Answer 30

1. INNOCENT
2. NEGLIGENT
3. FRADULENT