Vocabulary: Chapter 12-Agency Flashcards
Agency
The relationship between a principal and an agent wherein the agent is authorized to represent the principal in certain transactions
Agent
One who acts or has the power to act for another. A fiduciary relationship 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
Buyer’s Agent
A residential real estate broker or salesperson who represents the prospective purchaser in a transaction. The buyer’s agent owes the buyer-principal the common[law or statutory agency duties
Client
The principal
Customer
The third party or non-represented consumer for whom some level of service is provided
Designated Agent
A licensee authorized by a broker to act as the agent for a specific principal in a particular transaction
Designated Agency
A process that accommodates an in-house sale in which two different agents are involved. The broker designates on agent to represent the seller and an agent to represent the buyer
Dual Agency
Representing both parties to a transaction. This is unethical unless both parties agree to it, and it is illegal in many states
Express Agency
An agency relationship based on a formal agreement between the parties
Express Agreement
An oral or written contract in which the parties state the contract’s terms and express their intentions in words
Fiduciary
One in whom trust and confidence is placed; a reference to a broker employed under the terms of a listing contract or buyer agency agreement
Fiduciary Relationship
A relationship of trust and confidence, as between trustee and beneficiary, attorney and client, or principal and agent
Fraud
Deception intended to cause a person to give up property or a lawful right
General Agent
One who is authorized by a principal to represent the principal in a specific range of matters
Implied Agency
Based on the actions of the parties that imply that they have mutually consented to an agency relationship, an implied agency relationship is formed
Implied Agreement
A contract under which the agreement of the parties is demonstrated by their acts and conduct
Latent Defect
A hidden structural defect that could not be discovered by ordinary inspection and that threatens the property’s soundness or the safety of its inhabitant. Some states impose on seller and licensees a duty to inspect for and disclose latent defects
Listing Agreement
A contract between an owner (as principal) and a real estate broker (as agent) by which the broker is employed as agent to find a buyer for the owner’s real estate on the owner’s terms, for which service the owner agrees to pay a commission
Negligent Misrepresentation
Occurs when the broker should have known that a statement about a material fact was false
Nonagent
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. Also known as a facilitator, transaction broker, transaction coordinator, and contract broker
Principal
(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 the agent works
Puffing
Exaggerated or superlative comments or opinions
Special Agent
One who is authorized by a principal to perform a single act or transaction; a real estate broker is usually a special agent authorized to find a ready, willing, and able buyer for a particular property
Universal Agent
A person empowered to do anything the principal could do personally
