AGENCY RELATIONSHIPS and contracts Flashcards
CREATING AGNECY
listing, buyer agency and property management create an agency relationship.
PAYMENT OF MONEY DOES NOT
written contract or actions.
To earn a commission, agen must be licensed of transaction - have written compensation and the procuring cause.
Express Agency
parties state the contracts terms and express their intention orally or in writing
example - LISTING AGREEMENT
IMPLIED AGENCY
actions or conduct of the parties
example: “take this deal. it’s the best one for you”
TYPES OF AGENTS
General Agent
Special Agent
Universal Agent
Types of agencies
single agency
dual agency
facilitator or transaction broker
Designated agency
Listing agreement
personal service contact securing the employment of a brokerage firm to find a ready willing and able buyer
TYPES - exclusive right to sell exclusive agency open and net
Law of Agency
Outlines the duties and responsibilities of the principal and the agent
COALD - LOADS Loyalty - must be loyal Obedience Accountability Disclosure - disclosing facts and keep the principal SKILL/CARE
DISCLOSURE _ LAW OF AGENCY
if representing seller - the agent must disclose all if the BUYER is willing to offer more for the property
If representing the Buyer - an agent needs to disclose all DEFECTS and if the SELLER WOULD TAKE LESS FOR THE PROPERTY!!
VALID CONTRACT
meets all essential elements and is an enforceable contract
legally and mentally competent and authorized to perform
legally at the age of 18
offer and acceptance(MUTUAL ASSENT OR MEETING OF THE MINDS)
CONSIDERATION
REALITY OF CONSENT
offer must be made by one party
OFFEROR
accepted w/out any qualifications or changes by second party
OFFEREE
CONSIDERATION
promise or something of value
REALITY OF CONSENT
contact was entered into with our duress, menace, misrepresentation or fraud.
IF HAVE BEEN TRICKED CONTRACT IS VOIDABLE BY THE INNOCENT PARTY BUT VALID AS THE WRONGDOER
VOID
MISSING AN ESSENTIAL AND HAS NO LEGAL FORCE AND EFECT - EX -CONTRACT WAS NOT SIGNED BY THE PERSON WITH THE AUTHORITY TO PERFORM
VOIDABLE
IT MAY BE RESCINDED BY ONE OR BOTH PARTIES
CONTRACTS are VOIDABLE by the innocent party if entered into under duress, under the influence, though misrepresentation through fraud , with a minor or with incompetent person.
A CONTRACT WITH A CONTINGENCY THAT CANNOT BE MET MAY BE VOIDABLE.
PAYMENT OF COMPENSATION OR ITS SOURCE DOES NOT
CREAT THE AGENCY RELATIONSHIP. A CONTRACT OR THEA CTIONS OF THE PARTIES CREATES THE AGENCY RELATIONSHIP.
EXPRESS AGENCY
-when the parties state the contract terms and express their intention, either ORALLY or in WRITING
example LISTING AGREEMENT
IMPLIED AGENCY
actions or conduct of parties communicate that there is an agreement
TAKE THIS DEAL , ITS THE BEST ONE FOR YOU!
ELEMENTS OF A CONTRACT
OFFER AND ACCEPTANCE
CONSIDERATION
LEGALLY COMPETENT PARTIES
CONSENT LEGAL PURPOSE
SALES CONTRACT
expressly state in writing terms of the transfer of real property from the seller to the buyer
ID of SELLER AN BUYER
type of deed conveyed w/ restrictions
price of property/how purchaser will pay
amount of ernest money remedies for breach
provision for real estate taxes, insurance rent
securing loan, inspection, closing, possesion
person property to be left w/ real estate
personal property to seller inters to remove
payment of any special assessments
provision statin time period for acceptance
dated signatures OF ALL PARTIES
EXCULPATORY CLAUSE
hold harmless clause that may be found in contacts relieving a party from liability for injuries to another
INDEMNIFICATION CLAUSE
a clause in which one party agrees to compensate another for a loss or damage that is sustained
FORFEITURE CLAUSE
in a contract would allow the ernest money to be given to SELLER if the buyer defaults
FIDUCIARY RELATIONSHIP
legal relationship that creates a position of trust and confidence
REALITY OF CONSENT
contact was entered into with out duress , menace, misrepresentation, or fraud
VOID
when a contract has no legal force
EXCULPATORY CLAUSE
relieve or excuse a party from liability for injuries of the party - hold harmless clause
UNENFORCEABLE
oral reals estate contract
VOIDABLE
CONTINGENCIES WOULD MAKE A CONTRACT
TIME OF ESSENCE
REQUIREMENT NOT MET THE CONTRACT HAS BEEN BREACHED
LISTING AGREEMENT
IS NOT A NOTIFICATION THAT MUST BE SENT TO REGULATORY AGENCY
ALL COMMISSION CHECKS
MUST BE GIVEN TO THE PRINCIPAL BROKER
OFFER CAN BE REVOKED
AT ANY TIME BEFORE ACCEPTANCE - BECAUSE THE AGENT HAD NO COMMUNICATION OF ACCEPTANCE OF THE SELLER, THE BUYER HAS NO RESPONSIBILITIES FOR THE OFFER ONCE THE REVOCATION WAS COMMUNICATED TO HIS AGENT.
A SALES CONTRACT
DOES NOT CREATE AN AGNECY RELATIONSHIP
VOIDABLE
a licensee who withhold or lies about material facts may be guilty of MISREPRESENTATION or fraud and the contract may be VOIDABLE.
A licensee may not inflate the sales price in hopes of securing a listing and ten lower the price later.
EXAMPLE OF UNETHICAL BEHAVIOR
Exclusive Right to sell listing
brokerage gets paid even if the seller or someone else finds a house.
gives maximum broker proetection by eliminating procuring cause disagreements
Exculisve Agency listing
owner retains the right to sell w/o paying a commission
if anyone other than broker obtains the buyer - then the brokerage gets paid
agent would put into MLS and offer a co-op but would be less motivated due to compettion from the seller
Open Listing
nonexclusive listing
owner may list with more than one broker
listing broker gets paid if she retains the porcuring cause of the sale.
may be terminated at anytime before acceptance of an offer.
LISTING AGREEMENT
EXPRESS AGREEMENTS - in writing and signed
commission is negotiable on the listing agreement - price-fixing is a voiloation of sherman antitrust act
Agent earns a commision when a ready willing buyer brings an offer that meets all the terms of the sellers listing agreement - EVEN WHEN THE PROPERTY DOES NOT CLOSE
buyer agent would have earned a commision by finding a property that meets all the buyers requirements
price and terms
Specific termination date may not have an automatic rollover.
Listing terminates
closing of the sale
expiration
mutal recession
death or incapaacity of either brokerage firm - THE DEATH OF THE INDIVIDUAL sales person/ broker assicate does not terminate a listing
destruction of premises - HOUSE BURNS DOWN
bankruptcy of either broker or seller
breach or failure to uphold the agreemnt by either broker or seller
PROTECTION CLAUSE - EXTENSION CLAUSE - HOLDOVER CLAUSE - SAFTY CLAUSE
PROVIDES BOKER TO COLLET A COMMISSION FOR A CERTAIN LENGHT OF TIME AFTER THE TERMAINATION OF THE LISTING.
Valid Contract
contains all essential elements is binding on both parties and is enforcable by the courts
VOIDABLE CONTRACT
apperas to be valid but one party may disaffirm because that party is a minor or was subject to duress, fraud or misrepresntation
VOID CONTRACT
not enforcebale - beaus it does not contain all esstial elements
TENANT -LEASE
LESSEE
LANDLORD -LEASE
LESSOR
BUYER - PURCHASE AGREEMENT
VENDEE
SELLER - PURCHASE AGREEMENT
VENDOR
BUYER - CONTRACT FOR DEED
VENDEE
SELLER - CONTACT FOR DEEDN
VENDOR
MORTGAGE - BORROWER
MORTGAGOR
MORTGAGE - LENDER
MORTGAGEE
DEED OF TRUST LENDER
BENEFICIARY
DEED OF TRUST BUYER
TRUSTOR/GRANTOR
DEED OF TRUST - 3RD PARTY
TRUSTEE
DEED BUYER
GRANTEE
DEED SELLER
GRANTOR
UNILATERAL & BILATERAL
MAIND DIFFERENCE BETWEEN THE BOTH CONTRACTS IS THE OBLIGATIONS OF THE PARTIES
ASSIGNMENT -
TRANSFERS OBLICATIONS BUT NOT LIABILTY
NOVATION
NEW CONTRACT REPLACING AN OLD ONE - TRANSFER ALL ABOLICATIONS AND ALL LIABILTIY
CONTINGENCY CLAUSE
ALLWING THE BUYER TO TERMINATE UNDER CERTAIN CONDTIONS - BUYER WOULD GET EARNES MONEY BACK
