THE CE SHOP LAW OF AGENCY EXAM
QUESTIONS WITH COMPLETE
ANSWERS
The Information About Brokerage Services Brochure - Answer-an informational
brochure or form that explains the different types of agency representation available to
consumers. This form does not create or establish an agency relationship, and it is not
an agency disclosure. Texas real estate licensees are required by law to provide this
form.
Exclusive Right-to-Sell - Answer-A listing agreement that allows the listing agent to list
the property and receive a commission, no matter who brings the buyer to the seller.
Even when the owner finds a buyer, a commission is owed to the listing agent, provided
the sale occurs during the term of the listing agreement.
Exclusive Agency Listing - Answer-An agreement between a seller of property and a
broker in which the seller agrees to pay a commission to the broker if anyone other than
the owner finds a buyer, during the period of the agreement.
Open Listing - Answer-Non-exclusive agreement in which a seller may contract with
many real estate agents to locate a buyer. Only the agent who brings in the buyer earns
the commission.
Net Listing - Answer-an agreement in which the seller specifies a price desired for the
property and agrees to pay the broker a commission that's any amount received above
that price
Sub-Agent - Answer-An agent working under the main agent such as a salesperson for
a listing broker.
1980s - Answer--Agency Disclosures were required.
-Growth in Buyer Agency
1993 - Answer-Dual Agency became subject to statutory law when Texas legislature
amended the TRELA
1996 - Answer-- Intermediary Broker Introduced
- Texas Legislature eliminated statutory dual agency and amended TRELA to put
intermediary brokerage in the place of statutory dual agency with Senate Bill 489.
2005 - Answer-Dual Agency was Outlawed
Common Law - Answer-Laws that evolved from case laws or customs
, Statutory Law - Answer-Laws enacted by a legislature or other governing bodies
The Intermediary Relationship Notice - Answer-Notice establishing Intermediary
Consent from both parties
When should the seller's disclosure form be completed? - Answer-Before entering into a
sales contract
Latent Defect - Answer-a hidden structural defect that would not be discovered by
ordinary inspection
Owner's Title Insurance - Answer-Assures the buyer that the title is as stated
Provides for reimbursement up to the purchase price named on the owner's policy
Mortgagee's title insurance policy - Answer-Assures the lender that it has a valid first
lien against the property
Reimbursement is limited to the current outstanding loan balance
Leashold title insurance - Answer-Assures a lessee (tenant) that their lease is valid
Certificate of Sale title insurance - Answer-Issued to a purchaser in a court sale
Ensures that the purchaser's interest in a property sold under a court order
What must title insurance include? - Answer-Insured party's name
Property's legal description
Covered estate or interest
Schedule of all exceptions, as found in the public record
Any conditions and stipulations under which the policy will be issued
Subrogation - Answer-The process by which an insurer can, after it has paid a loss
under the policy, recover the amount paid from any party (other than the insured) who
caused the loss or is otherwise legally liable for the loss.
How many days does the Texas seller have to deliver a "commitment for title insurance"
to the buyer under the terms of the TREC One To Four Family Residential Contract
(Resale)? - Answer-20
QUESTIONS WITH COMPLETE
ANSWERS
The Information About Brokerage Services Brochure - Answer-an informational
brochure or form that explains the different types of agency representation available to
consumers. This form does not create or establish an agency relationship, and it is not
an agency disclosure. Texas real estate licensees are required by law to provide this
form.
Exclusive Right-to-Sell - Answer-A listing agreement that allows the listing agent to list
the property and receive a commission, no matter who brings the buyer to the seller.
Even when the owner finds a buyer, a commission is owed to the listing agent, provided
the sale occurs during the term of the listing agreement.
Exclusive Agency Listing - Answer-An agreement between a seller of property and a
broker in which the seller agrees to pay a commission to the broker if anyone other than
the owner finds a buyer, during the period of the agreement.
Open Listing - Answer-Non-exclusive agreement in which a seller may contract with
many real estate agents to locate a buyer. Only the agent who brings in the buyer earns
the commission.
Net Listing - Answer-an agreement in which the seller specifies a price desired for the
property and agrees to pay the broker a commission that's any amount received above
that price
Sub-Agent - Answer-An agent working under the main agent such as a salesperson for
a listing broker.
1980s - Answer--Agency Disclosures were required.
-Growth in Buyer Agency
1993 - Answer-Dual Agency became subject to statutory law when Texas legislature
amended the TRELA
1996 - Answer-- Intermediary Broker Introduced
- Texas Legislature eliminated statutory dual agency and amended TRELA to put
intermediary brokerage in the place of statutory dual agency with Senate Bill 489.
2005 - Answer-Dual Agency was Outlawed
Common Law - Answer-Laws that evolved from case laws or customs
, Statutory Law - Answer-Laws enacted by a legislature or other governing bodies
The Intermediary Relationship Notice - Answer-Notice establishing Intermediary
Consent from both parties
When should the seller's disclosure form be completed? - Answer-Before entering into a
sales contract
Latent Defect - Answer-a hidden structural defect that would not be discovered by
ordinary inspection
Owner's Title Insurance - Answer-Assures the buyer that the title is as stated
Provides for reimbursement up to the purchase price named on the owner's policy
Mortgagee's title insurance policy - Answer-Assures the lender that it has a valid first
lien against the property
Reimbursement is limited to the current outstanding loan balance
Leashold title insurance - Answer-Assures a lessee (tenant) that their lease is valid
Certificate of Sale title insurance - Answer-Issued to a purchaser in a court sale
Ensures that the purchaser's interest in a property sold under a court order
What must title insurance include? - Answer-Insured party's name
Property's legal description
Covered estate or interest
Schedule of all exceptions, as found in the public record
Any conditions and stipulations under which the policy will be issued
Subrogation - Answer-The process by which an insurer can, after it has paid a loss
under the policy, recover the amount paid from any party (other than the insured) who
caused the loss or is otherwise legally liable for the loss.
How many days does the Texas seller have to deliver a "commitment for title insurance"
to the buyer under the terms of the TREC One To Four Family Residential Contract
(Resale)? - Answer-20
