Types of Agents and the Fiduciary Duties of Real Estate Agents

Question 1

What is an agent?

Answer 1

An agent is the person who is authorized to represent and act on behalf of another person

Question 2

List the 3 types of agents

Answer 2

1. In a universal agency relationship, the principal empowers the agent to perform any and all actions that may be legally delegated to any agency representative
2. In a general agency, the principal delegates to the agent ongoing tasks and duties within a particular business or enterprise
3. Under a special agency agreement, the principal delegates authority to conduct a specific activity, after which the agency relationship terminates. In most instances, real estate brokerage is based on a special agency

Question 3

What is the law of agency?

Answer 3

The agency relationship that the agent and the principal establish puts in place a set of fiduciary duties that an agent owes to the principal

Question 4

What duties does an agent owe to his/her principal center on trust?

Answer 4

Care, including skill and diligence.
Obedience within the realm of legal activity
Accountability, retaining docs for at least 4 years
Loyalty, with an emphasis on confidentiality
Disclosure or Notice, including facts that the agent knows and those that the agent should have known
(COALDN)

Question 5

What disclosure or notice facts should the agent know about the property?

Answer 5

Deficiencies in the property, contract provision of financing terms that don’t suit the buyer’s interests, how long the property has been listed, why the seller is selling

Question 6

Who does the agent work for?

Answer 6

For the principal and with the customer

Question 7

Licensees owe their customers _

Answer 7

Honesty and fair dealing, reasonable care and skill, proper disclosure