State Flashcards
When someone without any authority (either actual or implied) holds himself out as an agent working for a principle. If the principle takes no action to stop the apparent agent; then the principle will himself be “estopped”from asserting that the apparent agent really is not his agent.
Apparent Agency (also referred to as Obstensbile Agency)
An automatic offer that is made by a listing agent to all other members of the Multiple Listing Service (MLS) when he submits his seller’s listing to a traditional MLS; the offer is accepted wherever an agent shows the listed property without rejecting the offer. (No longer used in Ohio.)
Blanket Unilateral Offer of Subagency
The agency relationship that exists between a buyer principal and the buyer’s agent.
Buyer Agency
The practice of representing only the buyer and never the seller in a transaction.
Buyer Agency Exclusively
A real estate agent who is employed by and represents only the buyer in a real estate transaction, regardless of whether the commission is paid by the buyer or by the seller, or through a commission split with the listing agent.
Buyer’s Agent
A buyer or seller represented by an agent who is subject to that buyer’s or seller’s control; also called a principal.
Client
Any fee that is conditional upon some event occurring, usually a closing.
Contingent Fee
A buyer who is working with an agent who represents the seller; also the seller of unlisted property that is being sold to a buyer represented by a buyer’s agent.
Customer
A dual agency relationship where the brokerage firm, by written or oral means, discloses and receives informed consent from both the buyer and the seller to act in a dual agency capacity.
Disclosed Dual Agency
A real estate agent who has received informed consent from both a buyer and seller in the same transaction to act in a dual agency capacity.
Disclosed Dual Agent
An agency relationship where the brokerage firm represents both the buyer and the seller in the same transaction to act in a dual agency capacity.
Dual Agency
A person who assists the parties to a potential real estate transaction in communication, interposition, and negotiation to reach agreement between or among them, without being an advocate for the interests of any party except the mutual interest of all parties to reach agreement. Also known as an intermediary. (Not recognized in Ohio.)
Facilitator
Duties owed by an agent to his principal (ACCOLD)
Fiduciary Duties Accountability Confidentiality Care (Reasonable Care and Skill) Obedience Loyalty Disclosure
Acknowledges that all money received in the agency relationship belongs to the principal, not the agent.The agent has the duty to strictly account for any amounts received in a transaction on behalf of the principal.
- Accountability
Agents must not reveal confidential information of a client.
- Confidentiality
Must be used by an agent at all times when acting on behalf of a client. Agents are seen as trusted professionals and experts, and as such, are held to a minimum standard of competence. Expertise should never be claimed in areas where one does not have special training, and agents must be careful never to engage in the unauthorized practice of law.
- Care (Reasonable Care and Skill)
Agents must follow all legal directions of the principal, obey the restrictions of the agency relationship, and not stray beyond scope of authority.
- Obedience
Agents must put the principal’s best interests above all others, including the agent’s own.
- Loyalty
An agent is obligated to disclose to his principal all relevant and material information, unless obtained through a previous fiduciary relationship, that the agent knows and that pertains to the scope of the agency. Duties of disclosure include: True property value, all offers to purchase, identity of the prospective buyer, buyer’s financial condition, any relationship between the buyer and the broker, and any commission splitting arrangements with other brokers.
- Disclosure
Any agency relationship that is indicated by the words and/or actions of the agent rather than by written agreement; also called accidental or undisclosed agency.
Implied Agency
A person’s agreement to allow something to happen that is based on a full disclosure of facts needed to make the decision intelligently, e.g., knowledge of liability involved, alternatives.
Informed Consent
A sale in which one real estate brokerage company acts as both the listing and selling agent.
In-Company Sale
An agent of the seller who markets that seller’s property, usually exclusively, and represents the seller during the sale and closing of the property. Also known as seller’s agent.
Listing Agent
An organized system created to disseminate information about listed properties and through which members offer cooperation and compensation to their participants; usually a committee of a Board or a corporation owned by a Board.
Multiple Listing Service (MLS)
MLS policy that allows listing agents to indicate the fee they will pay a buyer’s agent as well as the fee they will pay to a subagent upon a successful closing. An offer of subagency is mandatory. Also known as alternative MLS, but is not in all markets.
MLS PLUS
The proximate cause originating a series of events that, without break in their continuity, results in the accomplishment of the objective. A real estate broker will be regarded as the “procuring cause’’ of a sale, so as to be entitled to commission, if the broker’s efforts are the foundation on which the negotiations resulting in a sale are begun.
Procuring Cause
A real estate agent who is employed by and represents only the seller in a real estate transaction. Also known as listing agent.
Seller’s Agent
Any agent who sells a property; she may be the subagent or listing agent of the seller, or a buyer’s agent, or a dual agent. Also called a cooperating agent, or participating agent.
Selling Agent
The agency relationship that exists between a seller principal and the seller’s agent.
Seller Agency
The practice of representing the party you are working with (either buyer or seller) and becoming a disclosed dual agent for in-company sales.
Seller Agency And Buyer Agency with Disclosed Dual Agency for In-Company Sales
The practice of representing only the seller and never the buyer in a transaction.
Seller Agency Exclusively
The practice of representing either the buyer or the seller, but never both, in the same transaction.
Single Agency
A situation in which one agent represents the buyer and another agent from the same real estate brokerage represents the seller. The broker and all management-level employees are dual agents of both buyer and seller. The broker may also appoint a specific agent to represent the seller and another specific agent (from the same firm) to represent the buyer. Also known as in-company transaction.
Split Agency
An agent employed to act for another agent in performing functions undertaken for a principal, who owes the same duties and responsibilities to the principal as the principal’s agent. Correspondingly, the subagent can create the same liabilities for the agent and principal that the agent can create for the principal himself
Subagent
MLS in which listing agents must offer cooperation but don’t automatically offer subagency; the offer of compensation may be to buyer’s agents, subagents and/or listing agents; subagency may be offered.
Subagency Optional MLS
A dual agency relationship that occurs when a listing agent or subagent acts or speaks as though he also represents the buyer but without either written or oral disclosure. Conversely, dual agency also occurs when an agent of the buyer acts or speaks as if he also represents the seller.
Undisclosed Dual Agency
Under the common law, this relationship is defined as:
1. Agency is the fiduciary relationship that results from the manifestation of consent by one person to another that the other shall act on his behalf and subject to his control, and consent by the other so to act.
2. The one for whom action is taken is the principal.
3. The one who is to act is the agent.
In a real estate transaction, the agency relationship is formed between the brokerage firm (including all their licensees) and the principal.
Agency Relationship
- Lead-Based Paint (covered in detail starting on page 96)
- Asbestos: A fibrous material once very common in many building materials because of its insulating and heat-resistant value, but no longer used because it is believed to cause cancer.
- Urea-Formaldehyde Foam Insulation: A type of blown-in insulation that has been banned in many parts of the U.S. because of the potential health risks from toxic fumes.
- Radon Gas: A naturally occurring, odorless, colorless, radioactive gas that emanates from rocks and has been identified as a cancer-causing agent.
Residential Property Disclosure Form
Environmental Concerns With Real Estate
There are four specific hazards listed on the Residential Property Disclosure Form
As a dual agent, the agent(s) and brokerage shall:
Treat both clients honestly;
Disclose latent (not readily observable) material defects to the purchaser, if known by the agent(s) or brokerage;
Provide information regarding lenders, inspectors and other professionals, if requested;
Provide market information available from a property listing service or public records, if requested;
Prepare and present all offers and counteroffers at the direction of the parties;
Assist both parties in completing the steps necessary to fulfill the terms of any contract, As requested.
As a dual agent, the agent(s) and brokerage shall not:
- Disclose information that is confidential, or that would have an adverse effect on one party’s position in the transaction, unless such disclosure is authorized by the client or required by law;
- Advocate or negotiate on behalf of either the buyer or seller;
- Suggest or recommend specific terms, including price, or disclose the terms or price a buyer is willing to offer or that a seller is willing to accept;
- Engage in conduct that is contrary to the instructions of either party and may not act in a biased manner on behalf of one party.
