Agency Relationship in Real Estate
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Questions and Answers

What is the main role of an agent (broker) in a real estate agency relationship?

  • Enforcing fiduciary duties on the client
  • Finding a buyer, seller, tenant, or landlord
  • Writing contracts for their own benefit
  • Negotiating contracts on behalf of the client (correct)

    • What is the key characteristic of a Special Agency Relationship in real estate?

  • Pertains to a single transaction where agent cannot enter into contracts on behalf of the principal (correct)
  • Allows the agent to represent the principal in all matters
  • Involves representation in business affairs with similar contracting abilities
  • Creates a permanent bond between agent and principal

    • What is required for the establishment of an agency relationship in real estate?

  • A handshake agreement without any written documentation
  • An implied agreement based on mutual understanding
  • An indefinite agreement with no expiry date
  • A written or verbal contract outlining terms and conditions (correct)

    • In real estate, how can an implied agreement for an agency relationship be formed?

    <p>By intentional or unintentional actions of either party</p> Signup and view all the answers

    What is the significance of fiduciary duties in an agency relationship?

    <p>They impose obligations on agents to act in good faith and trust</p> Signup and view all the answers

    Why do certain states prohibit the existence of implied agreements in real estate agency relationships?

    <p>To protect clients from unethical behavior by agents</p> Signup and view all the answers

    What type of termination occurs when both parties agree to end the contract?

    <p>Voluntary</p> Signup and view all the answers

    What duty requires an agent to act within the bounds of their expertise?

    <p>Skill care and diligence</p> Signup and view all the answers

    What is the potential consequence of breaching an agent's fiduciary duties?

    <p>License suspension</p> Signup and view all the answers

    Which agency type represents both the seller and buyer simultaneously?

    <p>Dual Agency</p> Signup and view all the answers

    What is the primary objective of disclosure regulations in real estate transactions?

    <p>To offer a choice</p> Signup and view all the answers

    In fraud, what is required for a party to be damaged by a misstatement?

    <p>Reliance on the misstatement</p> Signup and view all the answers

    What distinguishes negligent misrepresentation from intentional misrepresentation?

    <p>'Negligent omission' involves unintended concealment</p> Signup and view all the answers

    When does a buyer agent need to disclose information to sellers?

    <p>Upon first substantive contact with the listing agent or seller</p> Signup and view all the answers

    What duty does a facilitator in real estate transactions owe to the parties involved?

    <p>Accounting, skill, care, diligence; honesty and fair dealing; disclosures affecting property value.</p> Signup and view all the answers

    What dual agency type requires informed, written consent before disclosing certain information?

    <p>Dual Agency</p> Signup and view all the answers

    What type of agency relationship empowers an agent to represent the principal in all matters and contract on behalf of the client?

    <p>Universal</p> Signup and view all the answers

    In real estate, what is a key requirement for the creation of an agency relationship?

    <p>Outlining terms and conditions in a written or verbal contract</p> Signup and view all the answers

    For which type of agency relationship is representation limited to a single transaction where agents typically cannot enter into contracts on behalf of their principals?

    <p>Special Agency</p> Signup and view all the answers

    What is the significance of having a definite expiry date in an agency agreement?

    <p>It provides clarity on the duration of agency representation</p> Signup and view all the answers

    Under what circumstances can an implied agreement for an agency relationship be formed?

    <p>Through intentional actions of both parties</p> Signup and view all the answers

    Which type of agency relationship often characterizes most brokerage relationships in real estate?

    <p>General Agency</p> Signup and view all the answers

    What is the consequence of breaching an agent's fiduciary duties, according to the text?

    <p>License revocation</p> Signup and view all the answers

    What type of agency relationship represents neither party involved in the real estate transaction?

    <p>No Agency</p> Signup and view all the answers

    In real estate, what distinguishes fraud from misrepresentation?

    <p>The intent behind the statement</p> Signup and view all the answers

    Which party must receive written disclosure regarding price, financing positions, or motivations from a dual agent?

    <p>Facilitator</p> Signup and view all the answers

    What is the primary objective of disclosure regulations in real estate transactions?

    <p>To provide informed choices</p> Signup and view all the answers

    What type of termination occurs when one party deserts or damages the property related to the contract?

    <p>Desertion or Damage of Property</p> Signup and view all the answers

    What duty requires an agent to place the client's interests above their own and customers' interests?

    <p>Loyalty</p> Signup and view all the answers

    When does a buyer agent need to provide written disclosure to sellers?

    <p>Upon first face-to-face contact</p> Signup and view all the answers

    In real estate, what is required for a party to be damaged by a misstatement?

    <p>Reliance on the misstatement and resulting harm</p> Signup and view all the answers

    Which agency relationship type represents either the tenant or landlord?

    <p>Single Agency</p> Signup and view all the answers

    What is the key requirement for establishing an agency relationship in real estate?

    <p>Having a definite expiry date in the contract</p> Signup and view all the answers

    What type of agency relationship in real estate involves representation in business affairs with similar contracting abilities as the agent?

    <p>General Agency</p> Signup and view all the answers

    Under what circumstances can an implied agreement for an agency relationship be formed?

    <p>Through the actions of either party, intentional or unintentional</p> Signup and view all the answers

    What distinguishes Special Agency from other types of agencies in real estate?

    <p>It pertains to a single transaction where agents typically cannot enter into contracts on behalf of their principals</p> Signup and view all the answers

    What is the consequence of breaching fiduciary duties in an agency relationship?

    <p>Legal action taken by the other party</p> Signup and view all the answers

    What does a single agency in real estate typically involve?

    <p>Representing either the seller or buyer</p> Signup and view all the answers

    What are the main duties of a dual agent in a real estate transaction?

    <p>Skill, care, diligence, obedience, confidentiality, and accounting</p> Signup and view all the answers

    What type of termination occurs when one party deserts or damages the property related to the contract?

    <p>Desertion or Damage of Property</p> Signup and view all the answers

    What is the consequence of a licensee boasting about a property's benefits?

    <p>License suspension</p> Signup and view all the answers

    What is required for a party to claim fraud in a real estate transaction?

    <p>Knowledge that a statement was false</p> Signup and view all the answers

    What is the primary duty of a facilitator in real estate transactions?

    <p>Skill, care, diligence; honesty and fair dealing</p> Signup and view all the answers

    When does a buyer's agent need to provide written disclosure to sellers in real estate transactions?

    <p>Upon first contact with listing agent or seller</p> Signup and view all the answers

    "Informed, written consent" is a requirement for which type of dual agency?

    <p>&quot;Dual Agency&quot;</p> Signup and view all the answers

    What type of agency relationship in real estate involves representation limited to a single transaction where agents typically cannot enter into contracts on behalf of their principals?

    <p>Special Agency</p> Signup and view all the answers

    Which type of agreement for an agency relationship in real estate can be formed through the actions of either party, whether intentional or unintentional?

    <p>Implicit Agreement</p> Signup and view all the answers

    What is the key requirement for establishing an agency relationship in real estate?

    <p>Written contract only</p> Signup and view all the answers

    Which type of agency relationship empowers an agent to represent the principal in all matters and contract on behalf of the client?

    <p>Universal Agency</p> Signup and view all the answers

    What is the consequence of breaching fiduciary duties in an agency relationship, according to the text?

    <p>Potential termination of the agency agreement</p> Signup and view all the answers

    Why do certain states prohibit the existence of implied agreements in real estate agency relationships?

    <p>To promote written agreements for clarity and protection</p> Signup and view all the answers

    What is the consequence of breaching an agent's fiduciary duties in a real estate transaction?

    <p>Loss of Compensation</p> Signup and view all the answers

    When does a buyer agent need to provide written disclosure to sellers in real estate transactions?

    <p>Before or when listing is executed</p> Signup and view all the answers

    What type of termination occurs when one party deserts or damages the property related to the contract?

    <p>Involuntary Termination</p> Signup and view all the answers

    What duty requires an agent to place the client's interests above their own and customers' interests?

    <p>Loyalty</p> Signup and view all the answers

    What is the primary objective of disclosure regulations in real estate transactions?

    <p>To offer a choice</p> Signup and view all the answers

    Which agency type represents both the seller and buyer simultaneously?

    <p>Dual Agency</p> Signup and view all the answers

    Under what circumstances can an implied agreement for an agency relationship be formed?

    <p>When actions imply agency relationship</p> Signup and view all the answers

    What distinguishes fraud from misrepresentation in a real estate transaction?

    <p>Intent to deceive</p> Signup and view all the answers

    What does a single agency in real estate typically involve?

    <p>Representing either the seller or buyer</p> Signup and view all the answers

    What is required for the establishment of an agency relationship in real estate?

    <p>Informed written consent</p> Signup and view all the answers

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