Unit 1 - Legal Issues and Risk Management Flashcards
Agency
The relationship between the agent and the principal
Agent
A person who acts on behalf of another person or group.
Buyer Brokerage Agreement
An employment contract with a purchaser.
Community Association
A nongovernmental association of participating members of a community, such as a neighborhood, village, condominium, cooperative, or group of homeowners or property owners in a delineated geographic area. Participation may be voluntary, require a specific residency, or require participation in an intentional community.
Consent to Transition to Transaction Broker
A written agreement to gain the principal’s permission to a change in the brokerage relationship.
Customer
One with whom the broker or sales associate hopes to be successful in accomplishing the purpose of employment. A buyer or seller of real property who may not be represented by a real estate licensee in an authorized brokerage relationship.
Designated Sales Associates
Two real estate licensees designated to represent the buyer and the seller as single agents in a nonresidential transaction. The buyer and seller each must have assets in excess of $1 million dollars and they must sign disclosures attesting to this fact.
Dual Agency
Representing both principals in a transaction. This is a brokerage relationship that is not legal in the state of Florida.
False or Misleading Statement
Misrepresentation or concealment of a material fact.
Fiduciary Relationship
An alliance of trust and confidence that creates a moral and legal obligation when extended by one person and accepted by another.
Innocent Purchaser Status
An individual who, in Good Faith and by an honest agreement, buys property in the absence of sufficient knowledge to charge him or her with notice of any defect in the transaction.
Material Fact
A material fact in real estate is information that, if known, might cause a buyer to make a different decision about remaining in a purchase contract, or to the price paid or received for property. Both residential and commercial properties can be impacted by material fact disclosure requirements.
Misrepresentation
A false or misleading statement of a material fact; concealment of a material fact.
No Brokerage Relationship Notice
When a licensee has no brokerage relationship with the buyer or seller, he/she still must disclose the parameters of the relationship and make the customer aware of the duties the agent will provide. The include 1. Dealing honestly and fairly; 2. Disclose all material facts about the property that may not be readily evident to the buyer; and 3. Account for all funds.
Principal
The party employing the services of a real estate broker; amount of money borrowed in a mortgage loan, excluding interest and other charges.
Property Condition Disclosure
Seller’s property disclosure in which the seller discloses all material facts about the condition of the property being sold.
Radon Gas
A naturally-occurring radioactive gas that can cause lung cancer. Radon gas is inert, colorless and odorless. Radon is naturally in the atmosphere in trace amounts. Breathing radon over time increases your risk of lung cancer. Radon is the second leading cause of lung cancer in the United States.
Single Agent
A broker who represents either the buyer or seller of real estate, but not both in the same transaction. It is the highest form, providing the most confidence to the customer that the Realtor represents only the customer’s interest.
Transaction Broker
A broker who provides limited representation to a buyer, a seller or both, in a real estate transaction, but does not represent either in a fiduciary capacity or as a single agent.
14
The number of hours of continuing education a sales associate needs to renew license after the first renewal period.
5
The number of years all disclosures and other transactional documents must be maintained
