Role in Agency Relationships

Question 1

All agency relationships are created at which level?

Answer 1

All agency relationships are created at the broker level.

Question 2

The salesperson derives his or her responsibilities from whom?

Answer 2

The salesperson derives their responsibilities from his or her broker.

Question 3

What does an agency relationship allow a broker to do?

Answer 3

An agency relationship allows a broker to perform tasks necessary to meet the needs of the client, such as to advertise the seller-client’s home or to show homes to a buyer-client.

Question 4

In any real estate transaction, what is the best way to turn a customer into a client?

Answer 4

The best way to turn a customer into a client is by written agreement - a listing agreement with a seller or a buyer’s representation agreement.

Question 5

A general agency exists between the broker and the salesperson. If the salesperson violates the licensing act, who besides the salesperson would also be held responsible?

Answer 5

The salesperson’s broker would also be held responsible for the violation.

Question 6

If a licensee leaves his or her broker, how many listing agreements and buyer agency agreements is the salesperson allowed to take to the next broker?

Answer 6

Because the broker owns all agency agreements, the salesperson would not be allowed to take any of these agreements to the next broker.

Question 7

If a broker has a multitude of tasks to perform for a client, the broker would be considered which type of agent?

Answer 7

In this situation, the broker would be a general agent.

Question 8

Written agreements and oral agreements can be express agency as long as the relationship has three key components. What are these components?

Answer 8

These three components are clear, concise, and understandable.

Question 9

In real estate agency, which term is interchangeable with principal?

Answer 9

The term “client” is interchangeable with principal.

Question 10

What is required to turn a customer into a “client or principal?”

Answer 10

A written and signed agency agreement (listing agreement or buyer’s agency agreement) is required to work with a client or principal.

Question 11

A buyer that has signed a buyer’s agency agreement with the broker will now receive services from the broker until what point of the transaction?

Answer 11

The broker will represent the buyer from the time of signing of the agreement through the closing of the transaction.

Question 12

Just by actions of the licensee, what can be created?

Answer 12

Agency representation can be created through actions of the licensee.
End of Page

Question 13

A broker may enter into an agreement to work for free. Which type of agency does this create?

Answer 13

This type of agency is a gratuitous agency.

Question 14

Agency by ratification is also known as what?

Answer 14

Agency After the Fact

Question 15

Which of the parties in a buyer’s agency agreement makes the ultimate decisions?

Answer 15

The buyer-principal always makes the final decisions.

Question 16

What must a broker obtain to represent a party as an intermediary?

Answer 16

The written consent of each party to the transaction.

Question 17

Licensee

Answer 17

Someone who is licensed in Texas as a salesperson or broker

Question 18

Agent

Answer 18

A broker who has an agency relationship with a seller, buyer, landlord, or tenant; a licensee who has an agency relationship with an employing broker

Question 19

SubAgent

Answer 19

A licensee who is not affiliated with the client’s broker, but who represents the client as a cooperating broker

Question 20

Broker Licensee

Answer 20

A person who is licensed as a broker in Texas

Question 21

Sponsoring Broker

Answer 21

A person who has responsibility for the real estate activities of a salesperson or another broker working under him or her (also known as an employing broker)

Question 22

Salesperson Licensee

Answer 22

A person who is licensed as a salesperson in Texas

Question 23

Seller’s Agent

Answer 23

A broker licensee who represents the seller in a transaction (also known as the listing agent)

Question 24

Buyer’s Agent

Answer 24

A broker licensee who represents the buyer in a transaction (also known as the selling broker or cooperating broker)

Question 25

Intermediary

Answer 25

A broker licensee who works for both the seller and the buyer in the same transaction (a special agency alternative allowed in Texas)

Question 26

Client

Answer 26

A person being represented in a real estate transaction (also called the principal)

Question 27

Customer

Answer 27

A person who gets some brokerage services but does not have an agency relationship with a broker

Question 28

A major component of real estate

Answer 28

is the relationship between the principal (also known as client) and the agent (also known as broker).

Question 29

When a broker has a relationship with a client

Answer 29

the broker has fiduciary duties that must be performed on behalf of the client. All focus must be on their client.

Question 30

The broker is

Answer 30

legally the agent of the client

Question 31

Licensees derive their responsibilities from their broker

Answer 31

Generally, these responsibilities are to find buyers and sellers for property, explain agency relationships, and enter into agency agreements.

Question 32

When a broker has an agency relationship with someone

Answer 32

he or she has the authority to act for that person. The broker is now allowed to perform tasks necessary to meet the needs of the client, such as to advertise the seller-client’s home or to show homes to a buyer-client.

Question 33

The best way to turn a customer into a client

Answer 33

is by filling out a listing agreement form or a buyer representation form:

Question 34

General Agency

Answer 34

The type of agency created between the broker and salespeople

Question 35

Special Agency

Answer 35

The agency relationship between the broker and clients

Question 36

Agency normally not found in a real estate office

Answer 36

universal agency. In this type of agency, a person or court would give an agent full control over someone’s life and belongings to meet a specific need.

Question 37

Express Agency

Answer 37

is the best type for both the broker and the client, where everything is very clear, concise, and understandable. This can be a written or oral agreement.

Question 38

Implied Agency

Answer 38

When a salesperson says or does something that creates agency such as giving advice to a customer, giving an opinion to a customer, or negotiating on the customer’s behalf

Question 39

A seller who lists with a broker

Answer 39

is not a client to all real estate licensees. The seller is only a client at the office where the listing was placed.

Question 40

buyer who is represented by a broker

Answer 40

is not represented by all brokers,but rather only by the broker with whom the buyer formed the agency relationship.

Question 41

When a buyer becomes a client of the broker,

Answer 41

a higher level of service will be provided by the real estate professional.

Question 42

most important task a broker needs to perform with the seller-principal

Answer 42

give a market analysis of what the property is worth

Question 43

Agency Can Be

Answer 43

created through the actions of the licensee

Question 44

A type of agency that is similar to implied agency is ostensible agency

Answer 44

This occurs when a court declares that the licensee was acting like an agent.

Question 45

Gratuitous agency

Answer 45

There are times when a broker may choose to work for free, such as selling his or her mother’s home