Texas Real Estate Agency: Chapter 4

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Questions and Answers

What is required to create an agency relationship?

A belief that the relationship exists.

What is express agency?

Express agency is created by either an oral or a written agreement between the principal and the agent.

What is implied authority?

Not specifically given to an agent.

What is agency based on a third party's belief called?

Ostensible agency. Signup and view all the answers

Which of the following statements is FALSE?

All of these are false statements. Signup and view all the answers

What does termination of agency for time refer to?

A contract for seller or buyer agency. Signup and view all the answers

To terminate the agency after successfully finding a home for a buyer, you need to:

Take no action. Signup and view all the answers

Why is it important to decide whom the broker represents?

Because the broker will owe the principal a higher standard of care and more extensive duties. Signup and view all the answers

What is notice to an agent that is considered notice to the principal called?

Implied notice. Signup and view all the answers

What duties continue after the termination of an agency?

The duty not to disclose confidential information. Signup and view all the answers

What elements are not essential for agency?

Writing Signup and view all the answers

What is express agency in legal terms?

The agency relationship created when principals engage or employ an agent to act for them. Signup and view all the answers

What is implied agency?

When a licensee working with a buyer-customer makes statements or performs actions that suggest agency. Signup and view all the answers

What does ostensible mean?

For all appearances. Signup and view all the answers

How is agency normally created in real estate?

By a written listing agreement with a seller or a buyer agency agreement with a buyer. Signup and view all the answers

What is agency by estoppel?

It arises when one person acts in such a way that another believes a third person is authorized to act on his behalf. Signup and view all the answers

Study Notes

Agency Relationships in Real Estate

Creation of an agency relationship requires a belief that the relationship exists.
Express agency establishes representational status through oral or written agreements between principal and agent.
Implied authority refers to powers not specifically granted to an agent.

Types of Agency

Ostensible agency occurs when a third party believes a licensee is acting as an agent without a formal agreement.
Express agency is defined as a clear and definite relationship where principals employ an agent, whether orally or in writing.
Implied agency arises when actions or statements made by a licensee lead a customer to believe they have agency representation.

Termination and Duties of Agency

When a buyer’s agency agreement successfully results in finding a home, no action is needed to terminate the agency.
Duties of agents occasionally persist beyond the termination of agency, especially concerning confidentiality.

Determining Representation

Clarifying whether the buyer or seller is the broker's principal is crucial, as it establishes the broker's heightened responsibilities.

Essential and Non-Essential Elements

Essential elements for agency include clear communication and intent; however, compensation, written agreements, contracts, and licenses are not essential for agency creation.

Implied and Ostensible Notice

Implied notice is a legal concept where notice given to an agent is seen as notice to the principal.

Agency by Estoppel

This principle holds that if one person's actions lead another to believe a third person is authorized to act, the first person is liable for transactions made under that belief.

Agency Fee Payment

Agency relationships can exist independent of who pays the agent’s fees, aligning with Texas law that does not link fee payment to agency determination.

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Description

Test your knowledge of key concepts from Chapter 4 of the Texas Real Estate Agency. This quiz covers essential terms and definitions related to agency relationships, including express agency and implied authority. Perfect for students preparing for real estate licensing exams.