Unit 9 Key Terms

Question 1

The relationship between the principal and the agent wherein the agent is authorized to represent the principal in certain transactions.

Answer 1

Agency

Question 2

One who acts or has the power to act for another.

Answer 2

Agent

Question 3

A principal-agent relationship in which the real estate professional acts on behalf of the buyer, usually as an agent, with the fiduciary responsibilities to the buyer.

Answer 3

Buyer representation agreement

Question 4

A real estate professional who is under contract to locate property for a buyer and represent the buyers interest in a transaction

Answer 4

Buyer’s agent

Question 5

The principal in an agency relationship or other form of representation.

Answer 5

Client

Question 6

The third party or non-represented consumer for whom some level of service if provided.

Answer 6

Customer

Question 7

A process that accommodates and in-house sale in which two different agents are involved. The broker designates one agent to represent the seller and one agent to represent the buyer.

Answer 7

Designated agency

Question 8

A real estate professional authorized by a broker to act as the agent for a specific principal in a particular transaction.

Answer 8

Designated agent or assigned agent or appointed agent

Question 9

Representing both parties to a transaction. This is unethical unless both parties agree to it, and it is illegal in some states.

Answer 9

Dual agency

Question 10

An agency relationship based on a formal agreement between the parties.

Answer 10

Express agency

Question 11

An oral or written contract in which the parties state the contracts terms and express their intentions in words.

Answer 11

Express agreement

Question 12

One in whom trust and confidence is placed; a reference to a real estate professional employed under the terms of a listing contract or buyer representation agreement.

Answer 12

Fiduciary

Question 13

A _____ is created under the Law of Agency when a property owner, as the principal, executes a listing agreement or management contract authorizing a licensed real estate broker to be his or her agent. A prospective property buyer may authorize a real estate broker to act as the buyer’s agent to find a suitable property.

Answer 13

Fiduciary relationship

Question 14

Deception intended to cause a person to give up property or a lawful right.

Answer 14

Fraud

Question 15

One who is authorized by a principal to represent the principal in a specific range of matters.

Answer 15

General agent

Question 16

If the actions of the parties imply that they have mutually consented to an agency relationship, and ____ is formed.

Answer 16

Implied agency

Question 17

A contract under which the agreement of the parties is demonstrated by their acts and conduct.

Answer 17

Implied agreement

Question 18

A hidden structural defect that could not be discovered by ordinary inspection and that threatens a property’s soundness or the safety of its inhabitants.

Answer 18

Latent defect

Question 19

Includes the following definitions: Agent, Principal, Agency, Fiduciary, Client, Customer, Non-agent.

Answer 19

Law of agency

Question 20

A contract between an owner (as principal) and a real estate professional (as representative of the owner) By which the real estate professional is employed to find a buyer for the owners real estate on the owners terms, for which service the owner agrees to pay a commission or other form of compensation.

Answer 20

Listing agreement

Question 21

Occurs when the real estate professional should have known that a statement about a material fact was false.

Answer 21

Negligent misrepresentation

Question 22

An intermediary between a buyer and a seller, or a landlord and a tenant, who assists one or both parties with a transaction without representing either.

Answer 22

Nonagent or Facilitator or Transaction Broker or Transaction Coordinator or Contract Broker

Question 23

1) A sum loaned or employed as a fund or an investment, as distinguished from its income or profits. 2) The original amount (as in a loan) of the total due and payable at a certain date. 3) A main party to a transaction- the person for whom an agent works.

Answer 23

Principal

Question 24

Exaggerated or superlative comments or opinions about a property.

Answer 24

Puffing

Question 25

Agency relationship in which the agent represents only one party to a transaction

Answer 25

Single agency

Question 26

One who is authorized by a principal to perform a single act or transaction; a real estate professional is usually a ________ authorized to find a ready, willing, and able buyer for a particular property, when representing a seller, or a _______ authorized to find a suitable property, when representing a buyer.

Answer 26

Special agent

Question 27

Helps both the buyer and the seller with paperwork and formalities in transferring ownership of real property, but who is not an agent of either party.

Answer 27

Transaction broker

Question 28

A person empowered to do anything the principal could do personally.

Answer 28

Universal agent