Ch 1 Agency Concepts

Question 1

Fiduciary equals

Answer 1

Trust

Question 2

Protection against damage or loss

Answer 2

Indemnification

Question 3

What does an agent do?

Answer 3

Acts on behalf of another person

Question 4

A person who receives limited brokerage services, without establishing an agency relationship is

Answer 4

A customer

Question 5

A client is also known as

Answer 5

The principal

Question 6

A relationship based on trust is also known as

Answer 6

A fiduciary relationship

Question 7

The agent must always ________ to the principal

Answer 7

Remain loyal

Question 8

In an agency, the relationship is between who

Answer 8

A principal and an agent

Question 9

What year was the Texas real estate license act (TRELA) passed?

Answer 9

1939

Question 10

The Texas real estate commission was created when?

Answer 10

1949

Question 11

The purpose of the Texas real estate license act is to what?

Answer 11

Protect the public against unscrupulous brokers, and sales agents

Question 12

What is the purpose of TREC?

Answer 12

To enforce TRELA

Question 13

The License at allows what two types of licenses to be issued?

Answer 13

A brokers license, and a sales agent license

Question 14

An active sales agents license may only be issued

Answer 14

Under the sponsorship of a licensed broker

Question 15

A broker works _______ a client

Answer 15

For

Question 16

A broker works ________ a customer

Answer 16

With

Question 17

An individual remains a customer until he or she

Answer 17

Enters an agency agreement

Question 18

What way can a seller become a client?

Answer 18

By entering a listing agreement with a broker

Question 19

What way does a buyer become a client?

Answer 19

By entering a buyer representation agreement with the broker

Question 20

Who determines the level of service a agent can provide

Answer 20

The customer or client

Question 21

What is a cooperative broker?

Answer 21

A broker selling the listing of another broker

Question 22

What are the duties of the principal to an agent?

Answer 22

CRIP: compensation, reimbursement, indemnification, performance

Question 23

What is compensation?

Answer 23

Refers to the fact that the agent should be paid on the completion of the agency

Question 24

What is reimbursement?

Answer 24

Refers to the fact that the principal should reimburse the agent for expenses, incurred on behalf of the principal, above, and beyond the expenses related to the sale itself

Question 25

What is indemnification?

Answer 25

It means the principle will protect the agent from suffering a loss due to the agents, reliance on information received from the principal

Question 26

True or false: if the seller misrepresented the property and the sellers disclosure, the agent will be indemnified if the agent was unaware of the misrepresentation

Answer 26

True

Question 27

Performance means

Answer 27

The principal is expected to perform as promised in the agency agreement

Question 28

An agency relationship exists when one person the ______, ask for on behalf of another person, the __________

Answer 28

Agent, principal

Question 29

Which of the following is grounds for suspension or revocation of a real estate license by TREC?

A. Splitting a commission with the person other than a license holder.
B. Splitting a commission with a Texas real estate license holder.
C. Disclosing, a material defect of a property.
D. All of these are grounds for suspension or revocation of a real estate license.

Answer 29

A. Splitting a commission with a person other than a license holder.

Question 30

The commission can deny licensure to an applicant based on the applicants?

Answer 30

Determination of fitness