Champions School of Real Estate - Exam
Prep
Buyer Representation Agreement - CORRECT ANSWER-An employment
contract obligating a broker to act as a fiduciary to a buyer
Implied Agency - CORRECT ANSWER-Agency as a result of customary, usual or
typical conditions
Broker - CORRECT ANSWER-A properly licensed party who serves a principal
in an agency relationship- also called an agent
Client - CORRECT ANSWER-A party represented by a broker in an agency
relationship - also called a principal
Duties of an Agent - CORRECT ANSWER-An agent owes his client obedience,
loyalty, disclosure, confidentiality, accounting and reasonable care (old car)
customer - CORRECT ANSWER-A third party - one a broker is working with, but
who is not represented by that broker
Exclusive Agency Listing - CORRECT ANSWER-A listing where one broker is
the exclusive agent and will earn a commission if the property is sold, unless the
seller sells it himself- the seller is competing with his broker
Ostensible Agency - CORRECT ANSWER-Agency as a result of the actions of
an agent and the response of other to those actions
Agency by Ratification - CORRECT ANSWER-Agency is established when an
agent acts without permission of the principal and the principal accepts or ratifies
those actions.
Blind Ad - CORRECT ANSWER-An advertisement that does not clearly indicate
the licensed status of the party placing the ad - real estate licensees are
prohibited from placing blind ads.
,Duties of Principal - CORRECT ANSWER-A principal owes his agent
compensation, reimbursement, indemnification and performance
Procuring Cause of Sale - CORRECT ANSWER-The effort that results in the sale
of property - the act of bringing a ready, willing and able buyer to a seller resulting
the sale of the seller's property
Exclusive right to sell - CORRECT ANSWER-A listing where one broker will earn
a commission when the property is sold, no matter who sells it
Listing Agreement - CORRECT ANSWER-An employment contract obligating a
broker to act as a fiduciary to a seller
Agency by Estoppel - CORRECT ANSWER-A principal fails to maintain due
diligence over his agent and as a result the court prevents the principal from
denying the agency relationship
Dual Agent - CORRECT ANSWER-A broker who has the written permission of
both the buyer and the seller to represent both parties in a single transaction
Management Agreement - CORRECT ANSWER-An employment contract
obligating a broker to act as a fiduciary to a property owner
Sherman Anti-Trust Act - CORRECT ANSWER-Federal law that preserves
business competition by prohibiting monopolies, monopolistic practices and
restraint of trade- in real estate the biggest impact is on commissions- always
negotiable
Agency - CORRECT ANSWER-The fiduciary relationship between a broker and
a principal or a broker and a client
Universal Agency - CORRECT ANSWER-A principal gives an agent the power to
transact matters of all types for him
Designated Agent - CORRECT ANSWER-A license appointed by a broker in a
dual agency situation to work with either the buyer or the seller in the transaction.
,Commission - CORRECT ANSWER-A negotiated compensation in a broker's
employment contract.
Fiduciary - CORRECT ANSWER-A party acting for another in a position of trust -
a broker, an agent
Public Responsibilities - CORRECT ANSWER-The responsibilities a broker has
to customers or third parties including honesty, fairness and disclosure of
material facts
General Agency - CORRECT ANSWER-A principal gives an agent the power to
bind him in a particular trade or business
intermediary - CORRECT ANSWER-A broker in Texas who has the written
permission of both the buyer and the seller to represent both parties in a single
transaction
Fiduciary Responsibilities - CORRECT ANSWER-The responsibilities a broker
has to clients in an agency relationship includes placing the interest of the client
first, full disclosure of all facts, material and other, and giving advice and opinions
Agency coupled with an interest - CORRECT ANSWER-Any transaction where
the agent is also the seller, or the agent is also the buyer, this dual role must
always be disclosed
Appointed Associate - CORRECT ANSWER-A licensee appointed by a broker in
Texas in an intermediary situation to work with either the buyer or the seller in the
transaction
Special Agency - CORRECT ANSWER-A principal gives an agent the power to
perform specific acts, but not to bind the principal - also called limited agency.
fiduciary relationship - CORRECT ANSWER-The relationship based on trust - the
relationship governed by the law of agency between a broker and a principal
, Subagent - CORRECT ANSWER-An agent for a person who is already an agent
for a principal - the listing salesperson under a listing broker - this is not a Texas
definition
Principal - CORRECT ANSWER-A party represented by a broker in an agency
relationship - also called a client
Oral Agency - CORRECT ANSWER-An agency relationship created by an oral or
spoken agreement
Limited Agency - CORRECT ANSWER-A principal gives an agent the power to
perform specific acts, but not to bind the principal- also called special agency
Open Listing - CORRECT ANSWER-A listing where a seller reserves the right to
list with as many brokers as he chooses - he also reserves the right to sell the
property himself - only a broker who brings a contract to the seller will earn a
commission
Module - CORRECT ANSWER-A unit of prefabricated housing - offsite
construction
Straight Line Method - CORRECT ANSWER-Depreciation of equal annual
installment amounts
Life Cycle - CORRECT ANSWER-The stage of growth and development of a
community - grow, stabilize, decline and revitalize
Principle of Substitution - CORRECT ANSWER-No person is justified in paying
more for a property when a similar property can be purchased for less - sets an
upper limit on price
Market Data Approach - CORRECT ANSWER-An appraisal used primarily on
residential properties - it involves comparing the subject property to recent sales
to determine a value - also called sales comparison approach
Gross Area - CORRECT ANSWER-The area of a building under the roof
includes unfinished areas.
Prep
Buyer Representation Agreement - CORRECT ANSWER-An employment
contract obligating a broker to act as a fiduciary to a buyer
Implied Agency - CORRECT ANSWER-Agency as a result of customary, usual or
typical conditions
Broker - CORRECT ANSWER-A properly licensed party who serves a principal
in an agency relationship- also called an agent
Client - CORRECT ANSWER-A party represented by a broker in an agency
relationship - also called a principal
Duties of an Agent - CORRECT ANSWER-An agent owes his client obedience,
loyalty, disclosure, confidentiality, accounting and reasonable care (old car)
customer - CORRECT ANSWER-A third party - one a broker is working with, but
who is not represented by that broker
Exclusive Agency Listing - CORRECT ANSWER-A listing where one broker is
the exclusive agent and will earn a commission if the property is sold, unless the
seller sells it himself- the seller is competing with his broker
Ostensible Agency - CORRECT ANSWER-Agency as a result of the actions of
an agent and the response of other to those actions
Agency by Ratification - CORRECT ANSWER-Agency is established when an
agent acts without permission of the principal and the principal accepts or ratifies
those actions.
Blind Ad - CORRECT ANSWER-An advertisement that does not clearly indicate
the licensed status of the party placing the ad - real estate licensees are
prohibited from placing blind ads.
,Duties of Principal - CORRECT ANSWER-A principal owes his agent
compensation, reimbursement, indemnification and performance
Procuring Cause of Sale - CORRECT ANSWER-The effort that results in the sale
of property - the act of bringing a ready, willing and able buyer to a seller resulting
the sale of the seller's property
Exclusive right to sell - CORRECT ANSWER-A listing where one broker will earn
a commission when the property is sold, no matter who sells it
Listing Agreement - CORRECT ANSWER-An employment contract obligating a
broker to act as a fiduciary to a seller
Agency by Estoppel - CORRECT ANSWER-A principal fails to maintain due
diligence over his agent and as a result the court prevents the principal from
denying the agency relationship
Dual Agent - CORRECT ANSWER-A broker who has the written permission of
both the buyer and the seller to represent both parties in a single transaction
Management Agreement - CORRECT ANSWER-An employment contract
obligating a broker to act as a fiduciary to a property owner
Sherman Anti-Trust Act - CORRECT ANSWER-Federal law that preserves
business competition by prohibiting monopolies, monopolistic practices and
restraint of trade- in real estate the biggest impact is on commissions- always
negotiable
Agency - CORRECT ANSWER-The fiduciary relationship between a broker and
a principal or a broker and a client
Universal Agency - CORRECT ANSWER-A principal gives an agent the power to
transact matters of all types for him
Designated Agent - CORRECT ANSWER-A license appointed by a broker in a
dual agency situation to work with either the buyer or the seller in the transaction.
,Commission - CORRECT ANSWER-A negotiated compensation in a broker's
employment contract.
Fiduciary - CORRECT ANSWER-A party acting for another in a position of trust -
a broker, an agent
Public Responsibilities - CORRECT ANSWER-The responsibilities a broker has
to customers or third parties including honesty, fairness and disclosure of
material facts
General Agency - CORRECT ANSWER-A principal gives an agent the power to
bind him in a particular trade or business
intermediary - CORRECT ANSWER-A broker in Texas who has the written
permission of both the buyer and the seller to represent both parties in a single
transaction
Fiduciary Responsibilities - CORRECT ANSWER-The responsibilities a broker
has to clients in an agency relationship includes placing the interest of the client
first, full disclosure of all facts, material and other, and giving advice and opinions
Agency coupled with an interest - CORRECT ANSWER-Any transaction where
the agent is also the seller, or the agent is also the buyer, this dual role must
always be disclosed
Appointed Associate - CORRECT ANSWER-A licensee appointed by a broker in
Texas in an intermediary situation to work with either the buyer or the seller in the
transaction
Special Agency - CORRECT ANSWER-A principal gives an agent the power to
perform specific acts, but not to bind the principal - also called limited agency.
fiduciary relationship - CORRECT ANSWER-The relationship based on trust - the
relationship governed by the law of agency between a broker and a principal
, Subagent - CORRECT ANSWER-An agent for a person who is already an agent
for a principal - the listing salesperson under a listing broker - this is not a Texas
definition
Principal - CORRECT ANSWER-A party represented by a broker in an agency
relationship - also called a client
Oral Agency - CORRECT ANSWER-An agency relationship created by an oral or
spoken agreement
Limited Agency - CORRECT ANSWER-A principal gives an agent the power to
perform specific acts, but not to bind the principal- also called special agency
Open Listing - CORRECT ANSWER-A listing where a seller reserves the right to
list with as many brokers as he chooses - he also reserves the right to sell the
property himself - only a broker who brings a contract to the seller will earn a
commission
Module - CORRECT ANSWER-A unit of prefabricated housing - offsite
construction
Straight Line Method - CORRECT ANSWER-Depreciation of equal annual
installment amounts
Life Cycle - CORRECT ANSWER-The stage of growth and development of a
community - grow, stabilize, decline and revitalize
Principle of Substitution - CORRECT ANSWER-No person is justified in paying
more for a property when a similar property can be purchased for less - sets an
upper limit on price
Market Data Approach - CORRECT ANSWER-An appraisal used primarily on
residential properties - it involves comparing the subject property to recent sales
to determine a value - also called sales comparison approach
Gross Area - CORRECT ANSWER-The area of a building under the roof
includes unfinished areas.
