Agency Relationships Flashcards
7 cards from real Real Estate License practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Agency Relationships flashcards as text
What is the primary distinction between a special agent and a general agent in real estate?
Answer: Special agents are authorized for one specific act; general agents have broader ongoing authority
A special agent is authorized only to perform a specific act such as selling one property, while a general agent has broader, continuing authority to act for the principal.
Implied agency is created when:
Answer: An agency relationship is established through the parties' words, conduct, or actions
Implied agency arises from the behavior and actions of the parties rather than a formal written or oral agreement, and can unintentionally create fiduciary obligations.
A listing agent discovers a serious structural defect in the property they represent. What is the agent's primary obligation?
Answer: Disclose it to potential buyers as a material fact
Agents must disclose all known material facts to potential buyers; concealing a structural defect violates the duty of disclosure and can expose the agent to legal liability.
A Transaction Broker (also called a Facilitator or Non-Agent) is a licensee who:
Answer: Assists both parties in a transaction without serving as a fiduciary for either
A transaction broker provides limited assistance to both parties without owing full fiduciary duties to either the buyer or seller.
The agent's fiduciary duty of accounting requires the agent to:
Answer: Properly account for all funds received or held on behalf of the client
The duty of accounting obligates the agent to accurately manage all client funds, such as earnest money deposits, preventing commingling or misappropriation.
What is designated agency in real estate?
Answer: A broker assigns separate agents from their office to each party in the same transaction
Designated agency allows a managing broker to appoint different licensees within the same firm to represent the buyer and seller separately, reducing dual agency conflicts.
For a dual agency arrangement to be legally valid, which of the following must occur?
Answer: Both the buyer and seller must provide informed written consent
Dual agency is only lawful when both the buyer and seller are fully informed of the conflict of interest and each provides written consent to the arrangement.