Chapter 10 Flash Cards

Flashcards by safiyyah, updated more than 1 year ago
Created by safiyyah about 5 years ago


Real Estate Agency

Resource summary

Question Answer
Agent A person authorized to act on behalf of the principal in dealings with a third party, Ex: A sales associate of a real estate broker act as agents of broker
Principal Individual who hires agent and delegates to that agent the responsibility of representing the principal's interests.
Agency The fiduciary relationship between the principal and the agent by which the agent is authorized to represent the principal in one or more transactions
Fiduciary The relationship in which the agent is held in a position of special trust and confidence by the principal.
Client The principal in a real estate transaction for whom a real estate broker acts as agent. The term Client is also used when a broker represents someone in a relationship other than an agency
Customer The third party or nonrepresented consumer who is not a principal but for whom some level of service may be provided and who is entitled to fairness and honesty. The customer may be represented by a separate agent.
Nonagent (Facilitator, intermediary, transactional broker, transaction coordinator, or contract broker) Someone who works with a buyer and a seller (or a landlord and a tenant), assisting one or both parties with the transaction without representing either party's interests. A broker may be considered a non agent when dealing with a customer (someone other than the person the broker represents).
Single Agent Works for the principal and with the customer. The agent represents only one of the parties to a transaction ex Seller or buyer. The agent supports and defends the principal's interests, not the customer's. The CLIENT is the PRINCIPAL to whom the agent gives advice and counsel.
Express Agency An agency relationship created by an oral or written agreement between the parties. The employment agreement of broker and sales associate must be in writing (listing agreement). A relationship between a buyer and a broker is created by a buyer representation agreement.
Universal Agent A person empowered to do anything the principal could do personally.
General Agent Represents the principal in certain business matters; A broad range of matters related to a particular business or activity.
Special Agent Limited agent, authorized to represent the principal in one specific act or business transaction only. Ex. A real estate broker is usually a special agent.
Seller Representation If a seller enters a listing agreement with a broker to market the seller's real estate, the broker becomes an agent of the seller; the seller is the principal, the broker's client.
Dual Agencey Agent represents two principals in the same transaction.
Termination of Agency Agency may be terminated for the following reasons: - Completion, performance, or fulfillment of the purpose for which the agency was created - Death or incapacity of either party - Destruction or condemnation of the property -Expiration of the terms of the agency - Mutual agreement by all parties to cancel the contract - Breach by one of the parties - By operation of law, as in bankruptcy of the principal (bankruptcy terminates the agency contract and title to the property transfers to a court appointed receiver)
Puffing Exaggeration of a property's benefits.
Fraud Intentional misrepresentation of a material fact in such a way as to harm or take advantage of another person.
Negligent Misrepresentation The real Estate professional should have known that a statement about a material fact was false. A real estate professional's lack of awareness of an issue is no excuse
Latent Defect A hidden structural defect that would not be discovered by ordinary inspection.
Stigmatized Properties Those that society has found undesirable because of events that occurred there or because of proximity of the property to a known nuisance. Ex. homicide or a criminal event
Megan's Law Federal Legislation which promotes the establishment of state registration systems to maintain residential information on every person who kidnaps children, commits sexual crimes against children, or commits sexually violent crimes.
Transactional Brokerage A broker who helps a buyer and a seller with paperwork but does not represent either party.
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