Champions School of Real Estate- Law of Agency Exam Questions and Answers

fiduicary - Answer- Act for or on behalf of another person Indemnification - Answer- protection against damage or loss agent - Answer- based on trust Customer - Answer- A person who receives limited brokerage services without establishing an agency relationship Client - Answer- principal An agency relationship exist when one person, the __________, acts for or on behalf of another person, the __________. - Answer- Agent, Principal Which of the following is grounds for suspension or revocation of a real estate license by TREC? a. Splitting the commission with a person person other than a license holder. b. Splitting commission with a Texas real estate license holder. c. Disclosing a material defect of property d. All of these - Answer- a. Splitting the commission with a person person other than a license holder. The Commission can deny licensure to an applicant base on the applicant's __________. - Answer- Determination of fitness Special Agency - Answer- Also known as limited agency General agency - Answer- The right to represent the principal in a particular type of transaction or business Express Authority - Answer- Authority that comes from specific instructions, either oral or written Universal Agent - Answer- The power to act for the principal in all transactions. Agency by Ratification - Answer- Established when an agent acts without prior authorization and the principal accepts it What form must an agent provide to potential client at the first substantive discussion of a real estate transaction? - Answer- Information About Brokerage Services (IABS) An example of a general agent in the world of real estate would be a(n)_________. - Answer- Property Manager Which of the following would NOT be an example of the fiduciary duty of reasonable care? a. Helping the client meet contract deadlines b. Assisting the seller to arrive at a reasonable listing price. c. Discovering relevant facts and disclosing these facts to the client. d. Taking the buyer or seller out to dinner when the transaction closes. - Answer- d. Taking the buyer or seller out to dinner when the transaction closes. In-house sale - Answer- A property sold by the listing firm Cooperative sale - Answer- A property is sold by a firm other than the listing firm Subagency - Answer- Created automatically with no discussion or action needed on the part of the brokerage firm. Listing side - Answer- The seller retains the services of a broker Selling side - Answer- The buyer retains the services of a broker Seller Kristen meets with agent Angel and likes his plan for marketing her home. She decides to sign listing agreement with hime, thereby creating a _______ relationship. - Answer- Special agency or Limited agency Broker Susan is representing the seller at We Sell it Fast Realty while broker Daniel from Daniels Properties is working with a buyer customer. Susan is representing the seller. Who is Daniel representing? - Answer- The seller. In Texas, there is no _______ agency relationship with any party to transaction. - Answer- Implied The commission charged is negotiated between the _______ and ________. - Answer- Seller and broker Which of the following is NOT one of the 4 statutory agency relationships allowed in Texas. a. dual b. seller c. buyer d. intermediary - Answer- a. dual Alternate Name - Answer- Also known as an alias Team name - Answer- Used by a group of one or more licensed holders sponsored or associated with the same broker. Assumed Business Name - Answer- Also known as DBA Stigmatized - Answer- a property on which a past event or condition affects its sale. Honesty - Answer- A special duty applied to license holders buying or selling property in their name. A broker's responsibility for disclosure is limited to areas - Answer- Accessible for visual inspection. According to TREC's advertising rules, which of the following terms MUST be used in a real estate team name? a. company b. Realty c. Associates d. Group - Answer- Group TREC's advertising rules require sales agents to include the broker's name, the brokerage name, or the broker's _________in at least 50% of the largest contact information font on all forms of advertising. - Answer- Assumed name CMA - Answer- analysis based on properties that have recently sold that are most similar to the subject property.