Ch. 10 Real Estate Agency

Question 1

agency

Answer 1

The relationship between the principal and the agent

Question 2

agent

Answer 2

one who acts or has the power to act for another . A fiduciary relationship is created under the law of agency.

Question 3

buyer representation agreement

Answer 3

express agency relationship between a buyer and a broker/stipulates the activities and responsibilities the buyer expects from the broker in finding the appropriate property for purchase or rent

Question 4

buyer’s agent

Answer 4

A real estate professional who is under contract to locate property for a buyer and represent the buyer’s interest in a transaction

Question 5

client

Answer 5

the principal in a real estate transaction for whom a real estate broker acts as agent. The term client is also used when a broker represents someone in a relationship other than an agency

Question 6

customer

Answer 6

the third party or nonrepresented consumer who is not a principal but for whom some level of service may be provided and is entitled to fairness and honesty.

Question 7

designated agency

Answer 7

A process that accommodates an inhouse sale in which two different agents are involved. The broker designates one agent to represent the seller and one to represent the buyer

Question 8

designated agent

Answer 8

A real estate professional authorized by a broker to act as the agent for a specific principal in a particular transaction; also may be called assigned agent or appointed agent

Question 9

dual agency

Answer 9

Representing both parties to a transaction. This is unethical unless both parties have agreed to it, and illegal in some states

Question 10

express agency

Answer 10

An agency relationship based on a formal agreement between the parties

Question 11

express agreement

Answer 11

parties formally express their intention to establish an agency and state its terms and conditions. either oral or written.

Question 12

fidicuary

Answer 12

the relationship in which the agent is held in a position of special trust and confidence by the principal

Question 13

fiduciary relationship

Answer 13

COLD-AC responsibilities to the principal

Care, Obedience, Loyalty, Disclosure, Accounting, and Confidentiality

Question 14

fraud

Answer 14

Deception intended to cause a person to give up property or a lawful right

Question 15

general agent

Answer 15

One who is authorized by a principal to represent the principal in a specific range of matters.

Question 16

implied agency

Answer 16

If the actions of the parties imply that they have mutually consented to an agency relationship, an implied agency relationship is formed.

Question 17

implied agreement

Answer 17

when the parties act as though they have mutually consented to an agency, often done unintentionally, inadvertently, or accidentally by their actions.

Question 18

latent defect

Answer 18

A hidden structural defect that could not be discovered by ordinary inspection and that threatens a property’s soundness or the safety of its inhabitants.

Question 19

law of agency

Answer 19

The law of agency is an area of commercial law dealing with a set of contractual, quasi-contractual and non-contractual fiduciary relationships that involve a person, called the agent, that is authorized to act on behalf of another (called the principal) to create legal relations with a third party.

Question 20

listing agreement

Answer 20

seller representation agreement, authorizes the broker to find a buyer or a tenant for the owner’s property

Question 21

negligent misrepresentation

Answer 21

occurs when a real estate professional ‘should have known’ a statement about a material fact was false

Question 22

nonagent

Answer 22

An intermediary between a buyer and a seller, or a landlord and a tenant, who assist one or bother parties with a transaction without representing either. Also known as a facilitator, transaction broker, transaction coordinator, and contract broker

Question 23

principal

Answer 23

the individual who hires the agent and delegates to that agent the responsibility of representing the principal’s interest. In a real estate transaction in which an agency relationship is established, the principal is the buyer or the seller or the landlord or the tenant. The broker is the principal in dealing with sales associates.

Question 24

puffing

Answer 24

exaggerated or superlative comments or opinions

Question 25

single agency

Answer 25

Agency relationship in which the agent represents only one party to a transaction

Question 26

special agent

Answer 26

(limited agent) One who is authorized by a principal to perform a single act or transaction; a real estate professional is usually a special agent authorized to find a ready, willing, and able buyer for a particular property,

Question 27

transaction broker

Answer 27

helps both the buyer and the seller with paperwork and formalities in transferring ownership of real property, but who is not an agent of either party

Question 28

universal agent

Answer 28

person empowered to do anything the principal could do personally