Chapter 10 Flashcards
A ________________ is a contract between a property seller and a broker or principal broker which authorizes the broker to act as an agent of the seller for compensation to offer the real property for sale or to find and obtain a buyer.
Listing agreement
A _________________ is the document a prospective buyer signs once he or she decides to work with a buyer’s agent at a particular brokerage.
Buyer representation agreement
A ____________ is a condition that must be met before the contract is enforceable.
Contingency
It is possible for both buyers and sellers to abuse contingencies in order to leave themselves a convenient way to cancel without defaulting. To avoid problems, the statement of a contingency should:
1) be explicit and clear
2) have an expiration date
3) expressly require diligence in the effort to fulfill the requirement
Unless expressly excluded, items commonly construed as ________ are included in the sale. Similarly, items commonly considered _________________ are not included unless expressly included.
Fixtures, personal property
A _________ is a contractual arrangement calling for the lessee (user) to pay the lessor (owner) for use of an asset.
Lease
A lease may be terminated sooner than its end date by:
1) Break/Cancellation (this depends upon the terms of the lease)
2) A negotiated deed of Surrender
3) Forfeiture
4) By operation of statute (rare)
What does the escrow clause in a sales contract do?
It provides for the custody and disbursement of the earnest money deposit, and releases the escrow agent from certain liabilities in the performance of escrow duties.
The relationship between the tenant and the landlord is called what?
Tenancy
An ____________ authorizes a broker to represent an owner or landlord.
Owner listing
A ______________ or _______________ agreement authorizes a broker to represent a buyer or tenant.
Buyer agency or tenant representation
The _____________ is a legally-binding contract that creates an agency relationship authorizing a broker to serve as the agent for a principal in a real estate transaction.
Listing agreement
Most listing agreements are ___________ employment contracts – meaning that the owner hires the broker and promises to pay a commission in exchange for the broker’s promise to locate a “ready, willing and able” buyer or tenant for the owner.
Bilateral
If the ______________ is not in writing, a broker could not collect his or her commission if the seller refused to pay.
Listing agreement
Under this arrangement, the broker has the exclusive right to market the property for a specified period of time.
Exclusive right to sell
An _______________ listing gives the broker the greatest assurance that he or she will receive compensation for his or her marketing efforts. And as a result, sellers usually see a quicker and more profitable sale of the property.
Exclusive right to sell
An ________________ listing agreement gives a broker the right to market and sell a property for a specified time period, while the owner retains the right to find a buyer and sell the property without owing the broker a commission. The seller must pay a commission only if the home is sold by the broker or an authorized agent or subagent of the broker.
Exclusive agency
An _______________ is a non-exclusive contract, authorizing a broker to serve as the agent for either the sale or the purchase of property. With this type of listing, a broker is not under the same obligation to perform as with other listing agreements, so an open listing is often considered to be a unilateral contract.
Open listing
A _______________ is not technically a type of listing agreement. In a net listing, an owner sets a minimum amount that he wants to receive from the sale of the property and lets the broker have as commission any amount above the set minimum.
Net listing
How does a net listing create a conflict of interest for a broker?
It violates the broker’s fiduciary responsibility of putting the client’s interests above his or her own.
Most buyer agent agreements have an enforceable _________________ clause that allows the broker legal recourse for compensation if the buyer purchases a property without compensating the broker during the period of the agreement, even if the broker did not show the buyer the property.
Exclusive right-to-purchase
The agent who ultimately caused the buyer to purchase the home and earned the commission is generally the _______________ agent.
Procuring cause
True or false: The Texas Real Estate License Act states that only brokers may list, sell or rent property. Agents have authority to list, but all listings must be done in the name of a licensed broker.
True
Which type of listing provides the most incentive for a broker to market a property?
Exclusive right to sell
A party’s failure to meet a contingency entitles the parties to:
Cancel the contract
What type of listing authorizes a broker to represent an owner or landlord?
An owner listing
Another term for leasehold estate is “__________________”.
Less-than-freehold estate
Leasehold estates are distinguished from freeholds by their _________________.
Temporary nature
