RE Law

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Author:
Anonymous
ID:
241146
Filename:
RE Law
Updated:
2013-10-17 00:21:16
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Law
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Description:
Midterm 2
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  1. 3 Elements to create agency
    mutual consent of principal and agent

    Agent acts ON BEHALF of principal

    Princpal has RIGHT to CONTROL the agent
  2. Express Authority of Agency
    Authority expressly given to agent by principal
  3. Implied Agency
    Agency is implied form conduct of parties, custom of trade, or act incidential to carrying out the agent's duties
  4. Apparent Agency
    Principal leads 3rd party into believeing the agent has authority
  5. By Ratification Agency
    Agent commits acts outside the scope of his authority, but thereafter is authorized by principal

    ex. finds home outside desired school district.  Principal loves homes and waives the act
  6. What is a RE broker
    • 1. Employed as agent for real estate dealings
    • 2. Listings in Broker's name
    • 3. Employs and supervises salesperson
  7. What is salesperson
    • 1. RE agent licensed by the state
    • 2. Required to work for licensed RE broker
  8. What is a Listing Agreement and its 4 requirements
    Contract where owner employes agent to sell his property

    • 1. IN Writing (oral agreements are unenforceable)
    • 2. State Price and Terms
    • 3. state duration of listing agreement
    • 4.Amount and structure of comission
  9. Types of RE Agency Relationship
    Listing: Works for seller

    Buyer
  10. Dual Agency? Requirments. Penalities
    One Agent represents both buyer and sellers.

    Both parites must be AWARE and SIGN off

    Punishment: Lose or pay back commission
  11. Designated Agency
    One firm represents both buyer and seller in transaction

    Broker designates one person to represent seller and another to represent buyer
  12. Cooperating Broker
    intrascation involving MLS, buyers agent is the Cooperating broker

    entitled to commission
  13. Non-agent broker
    Do not represent either seller or buyer as agent

    Assists and facilitates CLOSING the transaction

    NO FIDUCIARY duties to the parties
  14. Four Types of Listings
    • Open
    • Exclusive Agency
    • Exclusive Right to Sell
    • Net Listings
  15. Open Listing Agreement
    1. Seller can list property with MORE THAN ONE broker

    2. First agent to sell gets comission

    3. Seller Retains right to sell property themselves and owes not commission
  16. Exclusive Listing
    Seller pays commission to broker if broker sells property

    Seller can self sell property, and NO commission is paid

    If a 2nd broker is hired, original broker gets a commission NO MATTER WHAT. (aka seller may have to pay two commissions)
  17. Exclusive Right to Sell
    Broker entitled to commission regardless of who produces buyer (even if sale by owner)
  18. MLS?
    Network of RIGHT-TO-SELL listings

    1. members list and show properties to other members

    2. if sale is made, commission is paid to members
  19. In most states, when is commission owed
    When broker brings READY, WILLING, and ABLE buyer at the listing price
  20. Procuring Clause
    borker must bring seller and buyer together (need not actually close to the deal to receive commission)
  21. Net Listing Agreement
    Seller sets predetermined amount of money they wish to receive from the sale after expenses

    Broker receives anything paid above seller determined amount
  22. Requirements to be Sales person
    • 1. Must work for broker
    • 2.
  23. Broker Requirments
    • 1. 2 years as salesperson or two year RE experience
    • 2. Pass Exam
    • 3. 18 yrs old
    • 4. No Felonies
    • 5. Pay Fees
    • 6. Honesty Requirement
  24. Exemptions from Licensing
    • 1. Selling own home
    • 2 . LIcensed attorneys
    • 3. Finders
  25. Unlicensed activity
    • 1. Act as salesperson or broker without license
    • 2. Contract between unlicensed broker and seller is void
  26. Duties of a Brokers
    • 1. Act in best interest of princapl
    • 2. not lead seller to unsound transactions
    • 3.disclose all known material information
  27. Duty of Care
    Broker Must:

    • 1. Due diligence and pricing
    • 2. Communicate and present all offers
    • 3. Evaluate offers and inform of strengths and weakness
    • 4. Explain customs and practices of RE industry
    • 5. NO supply legal advice
  28. Brokers cannot do what to limite their liability?
    Cannot limit duty of care responsibilities through contract clauses
  29. Duty of Loyalty
    • Broker must not:
    • '1. Act as dual agent w/o consent
    • 2. Make Secret Profit (full disclosure of related interests wher eborker may profit at expense of principal)
    • 3. Disclose confidential information
    • 4. withhold material facts
  30. Broker's Duties to 3rd Parties?
    Typically have no duties except:

    • 1. Mispresentation
    • 2. Sales puffing
    • 3. Disclosure
  31. Intentional Misrepresentation
    broker knows of material fact and either:

    1. intentionall misstates to 3rd party

    or 

    2. knowingly fails to disclose to 3rd party
  32. Negligent Misrepresentations
    broker states a Material FAct w/o reasonable knowledge of its truthfulness

    3rd party relies on that statement
  33. Sales Puffing
    1. Opinon describing greatest of a property

    • 2. Misrepresentation when:
    • Statements inflate value and desirability of property without being "marketing"
  34. Intentional Nondisclosure
    Broker knows of material problems or defects UNLIKELY to be discovered and fails to disclose them to potential buyers
  35. As-Is Clause
    Buyer accepts property w/ all existing defects and no promise of repair


    Still must know:

    • latent defects
    • Broker can stil be liability for intentional misrepresentation
  36. Duties of Principal to Broker
    • 1. Compensation
    • 2. reimburse costs incurred
    • 3. indemnify: when principal fails to disclose a material fact and broker is sued for that fact

    * Principal owes no fiduciary duties to broker
  37. Reasons RE License can by suspended or revoced
    • commingling of funds
    • discrimiantion
    • felony convictions
    • split commissions w/unlicensed party
    • failure to deliever documnets
    • failure to submit all offers to seller
    • breach of fiduciary duties/unethical conduct
    • unauthorized practice of the law
  38. Fair Housing ACt
    Equal Opprotunity to buy, rent and live in properties

    Prohibits discrimination
  39. Fair Housing Exceptions
    When Owner sells his own home

    No agent

    No discriminatory advertising allowed

    Unit contains four or fewer units

    Owner resides in residential dwelling
  40. Blockbustin and racial steerin g
    blockbusting: telling people to move because a particular race, religion, etc. is moving in

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