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RESA LAW RA 96490 states that
"a real estate broker is an agent of a party in a real estate transaction to offer, advertise, (1) ______, promote, (2)_____ and negotiate a sale"
T or F: Real Estate broker is not limited to those licensed?
What are the real estate transactions handled by real estate brokers?
- (1) sales
- (2) exchange
- (3) lease
- (4) mortgage
- (5) joint venture
Real Estate Transactions:
sales or purchase: (1)____________
(2)___________: barter or exchange of real property, personal or business assets such as share of stocks
(4)___: pledge of real property as collateral for loan
(5)_____: land owners and developers partner together for a project
- (1) all kinds of real estate
- (2) Exchange
- (3) rentals, commercial leases
- (4) mortgage
- (5) joint venture
the act/ practice whereby a natural or judicial person, on behalf of a principal and for or in exception of commission or fee, negotiates the sale, purchase, lease, exchange, or mortgage of real estate
What are the essential elements of agency?
- (1) consent
- (2) object
- (3) agent acts on behalf of the principal
- (4) agent acts only within the scope of his authority
Essential Elements of Agency
(1) ______- mutual consent of both parties
(2)______- legal implementation of purpose agency
What are the general steps in brokerage? (5)
- (1) Securing Listing
- (2) Procuring Prospects
- (3) Presentation or briefing
- (4) Demonstration or tripping
- (5) Negotiation and closing
What is the--- "authority given by the seller/ buyer, lessor/ lessee, owner/ borrower for the broker to negotiate the sale, lease, exchange or mortgage or real estate, for a certain period of time, (1)________, for a stipulated rate of (2)_______?"
- (1) certain price and terms
- (2) commission
What are the two kinds of listing (1. as of form) and as of (2. exclusiveness)
- (1) oral and written
- (2) open/ non-exclusive or "First Come First Serve" and Exclusive
What is the safest form of listing contract?
Written form of listing
authority given to two or more brokers to negotiate a transaction
Open or Non-exclusive or "First Come First Serve" listing
authority given to only one broker to negotiate the transaction
What are the two types of exclusive listing?
(1)_______- a listing wherein, although only one broker is authorised, said broker is not entitled to commission if the principal himself closed the transaction
(2)_______- a listing where the sole authorised broker is entitled to commission if the principal himself closed the deal
- (1) Exclusive Agency Contract
- (2) Exclusive Right to Sell
What are the types of functions of a broker?
- (1) sales agency
- (2) purchase agency
- (3) exchange agency
- (4) lease agency
- (5) loan agency
Function of Broker:
(1)_______: authority given be a purchaser for the broker to look for a buyer and negotiate the sale
purchase agency: (2)
exchange agency: (3)
(4): authority given by the owner of a rental property for the broker to secure tenants or an authority given by a prospective tenant for the broker to look for a space to be rented
(5): authority given by a borrower for the broker to negotiate and secure a loan to be secured by real estate, or authority given by a financial institution for the broker to procure borrowers
- (1) sales agency
- (2) authority given by a purchaser for the broker to look for a property and negotiate
- (3) authority given by an owner for the broker to negotiate the exchange of his property
- (4) lease agency
- (5) loan agency
As to Basis of Compensation:
(1)________: once where the compensation of the broker depends on mark-up
(2)________: one where the compensation of the broker is prestipulated percentage of the consideration or load obtained
- (1) net listing
- (2) percentage listing
The contents of listing contract refers to...?
an Authority to Sell form
What are the sources of listing?
personal contracts, (1)_____, membership in clubs and associations, fellow real estate practitioners, (2)_____, (3) advertisements, internet
- (1) referrals
- (2) banks and financing institutions
- (3) advertisements
Factors consider in listing/ also tips for buying real estate:
price quotation of the owner--check its (1)_______ by market data
title is (2)_____ from any condition or annotation (liens and encumbrances), which may constitute legal obstacles to its disposition. Conduct title verification or (3)______
person giving authority is the (4)________. The registered owner/s could be dead already (estate tax must be paid first)
verification whether the property or portion thereof will be affected by (5)_______.
information on whether or not arrangement have been made for moving out (6)_______.
property must be outside (7)_______ for priority development covered by urban land reform
verification, in case of agricultural land, whether disposition is valid under (8)_______. check legal use of land
- (1) "fairness"
- (2) free
- (3) due diligence
- (4) owner/ duly authorized representative
- (5) expropriation
- (6) tenants or informal settlers
- (7) 244 areas
- (8) agrarian reform law
What are the restrictions on use which might affect the value of property?
NAPOCOR lines (15-20 meters from the center restriction on use)
legal use of the property (land classification and zoning)
- (1) right-of-way, easement
- (2) DPWH road widening (15-20 meters from the center restriction on use)
- (3) presence of informal settlers
Sharing on the expenses related to sale:
BIR taxes (DST, CGT, CWT, VAT, estate tax, assessor)
(1)__________(realty tax, business tax, transfer tax, assessor)
registration (reg. of deeds)
notrial fees, survey and relocation
subdivision of title if portion only of the property is to be purchased
lawyer's fee, if applicable
extrajudicial settlement expenses, if applicable
- (1) local
- (2) documentation and registration expenses
Compare a prospect from a suspect?
Prospect: a person who is in need and can afford to buy
Suspect: a person who has the willingness but does not have the capacity or one who has the capacity but without willingness
one with the willingness to have the capacity is a future prospect
Why do people buy real estate?
people in the first class will usually pay (3)____ than those in the second and the lowest price of all paid by the speculator who is interested in quick turnover and profit
- (1) investment
- (2) speculation
- (3) more
What are the factors considered in qualifying prospects?
- (1) capacity to pay and interest
- (2) legal aspect and other qualifications
What is--"the orderly written/ oral explanation of facts and figures that make a given property attractive to a purchaser"
-can be in the form of description of property such as its physical character, legal, location neighborhood, lot plan, location, vicinity map, photocopies of titles and tax declaration, etc.
presentation or briefing
What is the scope of presentation or briefing?
property identification and description
(2)________: present and potential income, durability of income stream, return on investment
(3)________: maps, pictures, visual aids (incest in laptop for better presentation)
(4)________: reservation, down payment, monthly amortization, expenses of sale to be shouldered by the seller and the buyer especially tax aspect
(5) financing available in case of installment
- (1) advantages and benefits
- (2) income or investment properties
- (3) presentation
- (4) computation
What is under identification and description?
location, lot and block, (1)______, (2)_____, lot area, registered owner, type of property, (3)_____, zoning classification, price and terms, (4)______
- (1) title number
- (2) registry of deeds
- (3) description of improvements
- (4) pictures of property
What is under income or investment properties?
present and potential income, (1)______, (2)______
- (1) durability of income stream
- (2) return on investment
What is the process showing the property and pinpointing of its physical qualities and other benefits and advantages to arouse the desire to possess or own it. Generally no tripping no closing.
Demonstration or tripping
What is the preparation for demonstration?
(1) preparation of checklist of the ________ and _________ which may be the object of prospects inquiry
(2) anticipation of possible _______
(3) organization of ____________ to be emphasized
(4) appointment with prospect and notice of ________
(5) selection of ideal _______ to create favorable impression of the neighborhood
(1) physical attributes and other data
(3) selling points
What is ---"the process of reconciling the opposing views of the parties to a transaction as to price and terms"?
What are the items that should be covered in negotiation?
a. price and terms
b. (1)__________(local taxes, BIR taxes, informal settlers, relocation/ subdivision expenses, conversion/ change in use, documentation and registration plus representation expenses)
d. pro-rating of insurance premiums and utilities
e. pro-rating of (3)_________
f. items including or excluded in sale, telephone, furniture, fixture
- (1) expenses of execution and registration of sale
- (2) date of delivery of property
- (3) income or rental from the property
What are the common difficulties during negotiation?
a. Hesitancy of prospect to express (1)______, thereby leaving the broker without any opportunity to answer or overcome it
b. presence of supposed advisors of the prospect who give negative remarks which tend to (2)_________
c. failure or inability to analyze prospect's (3)______
d. prejudice on either seller and buyer because of differences in (4)_______, _______, ______
e. misrepresentation of the (5)_______ or _____________
f. disagreement in sharing of (6)________
g. too much taxes imposed on the (7)_______ (withholding tax, documentary stamp tax, value-added tax, business tax in some cases)
h. problem on (8)________ and _______ at the title
- (1) objection
- (2) undermine transaction
- (3) profitability
- (4) religion, political beliefs and superstition
- (5) seller or seller's representative
- (6) expenses of sale
- (7) sale of property
- (8) problem on informal settlers and annotation of the title
What is the---"process where, thru the mediation of the broker, the minds of the parties meet"?
What are the general steps in closing?
(a) persuading the prospect to submit a written offer to purchase (1)_____________
(b) securing (2)________ of the offer to purchase, or assisting the seller in preparing a counter offer
(c) drafts of agreement for consideration of the parties
- (1) preferably with earnest money or intent to buy
- (2) acceptance
- (3) drafts of agreement for consideration of the parties