Texas Real Estate Agency: Chapter 4 Questions and Answers Already Passed

Texas Real Estate Agency: Chapter 4 Questions and Answers Already Passed Which is required to create an agency relationship? A belief that the relationship exists. Express agency Express agency is created by either an oral or a written agreement between the principal and the agent. It indicates their express intent for this representational status. Implied authority is not specifically given to an agent. Agency based on a third party's being led to believe that a licensee was acting as an agent of another party is ostensible agency. Which of the following statements is FALSE? All of these are false statements: (1) A licensee who is not compensated for services is not liable; (2) the broker and a consumer must enter into a written agreement to establish an agency relationship; and (3) The buyer must be personally notified of a property defect or the seller is liable for failure to disclose. Which statement is TRUE regarding termination of agency for time? A contract for seller or buyer agency. You entered into an agency agreement with and successfully found a home for a buyer. To terminate the agency, you need take no action. Which statement is TRUE regarding the determination of whom the broker represents? It is important to decide whether the buyer or the seller is the broker's principal because the broker will owe the principal a higher standard of care and more extensive duties. Notice to an agent that is considered notice to the principal is known as implied notice. Duties that continue after the termination of agency include the duty not to disclose confidential information. Elements not essential for agency: (1) compensation; (2) writing; (3) contract; and (4) license. Express Agency is the agency relationship created when principals engage or employ an agent to act for them. In legal terms, the word express means clear, definite, explicit, unmistakable, and unambiguous -- ORAL or WRITTEN. Implied Agency when a licensee who is working with a buyer-customer with no intended representation makes statements or performs actions that lead the customer to believe the licensee has become the customer's agent. Ostensible Agency Ostensible means "for all appearances." Agency In real estate, agency is normally created by either a written listing agreement with a seller, or a buyer agency agreement with a buyer. Some states allow verbal agreements, but most do not. An agency relationship can exist without regard to who pays the fee: the seller, the buyer, both, or neither. Texas law, like most state agency disclosure alws, confirms the common-law rule that paymnent of the fee does not determine agency. Agency by Estoppel The concept of agency by estoppel arises where one person acts in such a way that the other believes that a third person is authorised to act on his behalf and enters into a transaction with the third person, the person whose act induced him to do so, is liable for that agreement as if the third person acted on his behalf. It is based on the principle of natural justice and equity.