Unit quiz 11 Flashcards
Personal property included in a sale of real estate may include
A) a detached garage.
B) a built-in microwave range.
C) fireplace equipment.
D) attached patio covers.
C) fireplace equipment.
Proof of title to real estate may be provided by a warranty deed, title insurance policy, or
A) homeowners insurance policy.
B) any utility bill.
C) abstract of title with attorney’s opinion.
D) property tax statement.
C) abstract of title with attorney’s opinion.
A broker sold a residence for $485,000 and received $26,675 as commission in accordance with the terms of the listing agreement. What was the broker’s commission rate?
A) 6.5%
B) 6%
C) 5.5%
D) 5%
C) 5.5%
Commission rate × Selling price = Commission, so Commission ÷ Selling price = Commission rate; therefore, $26,675 commission ÷ $485,000 selling price = 0.055, or 5.5% commission rate.
The broker’s commission on a real estate sale is usually paid at closing directly by the
A) title officer.
B) buyer, who is providing the funds.
C) seller or the party handling the closing.
D) buyer’s attorney.
C) seller or the party handling the closing
A seller listed her residence with a broker. The broker brought an offer at full price and terms of the listing agreement from a buyer who is ready, willing, and able to pay cash for the property, but the seller rejected the buyer’s offer. In this situation, the seller
A) must sell her property.
B) owes a commission to the broker.
C) is liable to the buyer for compensatory damages.
D) is liable to the buyer for specific performance.
B) owes a commission to the broker.
Which of the following is a similarity between an open listing and an exclusive agency listing?
A) Under each, the broker earns a commission regardless of who sells the property, as long as it is sold within the listing period.
B) Under each, the seller avoids paying the broker a commission if the seller sells the property to someone the broker did not procure.
C) Each grants a commission to any broker who procures a buyer for the seller’s property.
D) Each grants the exclusive right to sell to whatever broker produces a buyer for the seller’s property.
B) Under each, the seller avoids paying the broker a commission if the seller sells the property to someone the broker did not procure.
Which statement is TRUE of a listing agreement?
A) It obligates the seller to transfer the property if the broker procures a ready, willing, and able buyer.
B) It automatically binds the owner, the broker, and the MLS to its agreed provisions.
C) It obligates the broker to work diligently for both the seller and the buyer.
D) It is an employment contract for the professional services of the broker.
D) It is an employment contract for the professional services of the broker.
The listing is the broker’s contract of employment by the
seller
It is not a contract between the seller and any buyer and so cannot be enforced on the seller by a buyer, even though the buyer might make an offer that is the “mirror image” of the terms of the listing. In such an event, however, the seller may owe the broker a full commission for having produced the result the listing called for: an able buyer who is ready and willing to buy according to the terms of the listing.
The provision in a contract with a property seller that gives additional authority to the broker and obligates the broker to alert other brokers to the availability of the property is a(n)
A) open listing clause.
B) joint listing clause.
C) net listing clause.
D) multiple listing clause.
D) multiple listing clause.
All of the following reasons are valid bases for terminating a buyer representation agreement EXCEPT
A) agreement of the parties.
B) death of the sales associate who worked with the buyer.
C) death of the broker.
D) purchase of a property.
B) death of the sales associate who worked with the buyer
A buyer signed an agreement with a broker to compensate the broker even if the buyer purchases the property from a relative. This is called an
A) open buyer representation agreement.
B) exclusive buyer representation agreement.
C) invalid agreement.
D) exclusive agency buyer representation agreement.
B) exclusive buyer representation agreement.
An exclusive buyer representation agreement binds the buyer to compensate the agent whenever the buyer purchases a property of the type described in the contract, even if the buyer finds the property independently.
A seller hired a broker under the terms of an open listing agreement. While that agreement was still in effect, the seller—without informing the first broker—hired another broker from a separate firm under an exclusive right-to-sell listing for the same property. If the first broker produces a buyer for the property whose offer the seller accepts, the seller must pay a full commission to
A) neither broker.
B) both brokers.
C) only the second broker.
D) only the first broker.
B) both brokers.
The broker with the open listing who procures the buyer is due her full commission. The broker with an exclusive right to sell listing is due a full commission if the listed property is sold by anyone during the term of the listing. Both these events occurred. Two full commissions are due.
Most states require that a real estate listing agreement contain
A) an automatic extension clause.
B) a broker protection clause.
C) a definite contract termination date.
D) a multiple listing service (MLS) clause.
C) a definite contract termination date.
. Failing to specify a definite termination date in a real estate listing can be grounds for suspension or revocation of a license in most states. Automatic extensions have been discouraged by courts. Broker protection clauses and MLS clauses are not required.
