texas agency – Flashcards
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The Texas Supreme Court has ruled that for an "as is" agreement in a contract to be effective against the purchaser, it must pass several tests, which include
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-seller must not have obstructed the buyer's attempts to inspect the property. -all known defects must have been disclosed by the seller. -the buyer and the seller must be in relatively equal bargaining positions.
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The nonexclusive single-agency broker would have an office policy allowing representation of each of these consumers in a transaction EXCEPT
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both the seller and the buyer.
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A licensee who represents a principal in a proposed real estate transaction must disclose that representation
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orally or in writing, whenever first coming into contact with the other party to the transaction.
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A salesperson sold a property to an unrepresented buyer in a cooperative sale. Which statement is TRUE?
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The salesperson represents her broker, who is a subagent of the seller's broker.
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Punitive damages are
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punishing damages
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One of the primary requirements to establish an independent contractor status as defined by IRS regulations is a
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written contract with a statement that the salesperson will not be treated as an employee for federal tax purposes.
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A listing agreement does not authorize a listing broker to
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execute a document in the name of the seller concerning the property.
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When presenting an offer to a listing agent on behalf of a buyer, the buyer's agent must NOT
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indicate that the buyer is willing to pay more than the offer being made.
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A seller's agent is permitted by law to
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present an offer from the agent's parents with full disclosure of the relationship.
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An illegal boycott has occurred when two or more business entities conspire to
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withhold their patronage to reduce competition
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A broker with an office policy of nonexclusive single agency is similar to a broker offering intermediary services in all of these examples EXCEPT
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both may represent buyers and sellers in the same transaction.
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A listing agent would be required to disclose to a potential buyer all of the following EXCEPT
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The sellers are getting a divorce.
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The type of listing contract that guarantees the listing broker will be paid a commission if anyone, including the seller, finds a buyer for the property, is the
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exclusive-right-to sell listing.
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The Information About Brokerage Services Form informs consumers
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that they have a right to choose the type of representation they wish to receive, if any.
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Which is NOT an essential element of a cause of action for fraud?
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mistake
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In the typical residential transaction involving an MLS-listed property and two brokers, where subagency has been offered and accepted, which agent owes primary allegiance to the buyer?
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subagent
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When may a broker in Texas take a net listing?
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When a seller requires it and is familiar with market values
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TREC Rules
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do not require licensees to be members of trade associations.
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A broker has an office agency policy of exclusive seller agency. Which BEST describes the broker's policy? The company policy is of
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representing sellers as a listing broker.
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A broker at a listing appointment, before signing the listing contract, decides she would like to purchase property for her own use. In this case the broker must advise the seller of all the following EXCEPT
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that the offered price may not reflect market value.
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One who has accepted a delegation of authority to act for and on behalf of another is a(n)
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agent
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A broker is previewing a For-Sale-by-Owner (FSBO) property to determine if it meets the requirements of her buyer-client. While touring the property with the FSBO, which statement would cause the broker to be in breach of fiduciary duty to the buyer?
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"My buyer will need you to agree to seller financing because she has a low credit score."
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One reason for an agent's obligation to exercise integrity in discharging his responsibilities is to avoid
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acts of fraud
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A cooperating broker acting as a subagent tells a buyer that the seller is filing for divorce and for bankruptcy. This disclosure would be improper unless
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the seller authorized the release of this information
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An agent would NOT owe fiduciary duties to a
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sponsoring broker
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In an intermediary transaction, which of these statements FALSE?
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The broker may disclose confidential information.
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The initial disclosure of an agency relationship may be
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oral or written
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A buyer approaches a broker regarding purchasing a new home in the area. The broker presents the Information About Brokerage Services (IABS) form and circles "BUYER" at the bottom of the form. If the buyer signs the form, there is proof that
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the buyer has been given notification in writing of various brokerage services available in Texas as required by law.
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If a licensee is found guilty of violating the DTPA, the remedies available to the court include
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entering a financial judgment for damages against the licensee.
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The general agency relationship created by the written agreement between a broker and a salesperson establishes that
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both the broker and the salesperson owe fiduciary duties to customers.
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TRELA prohibits a licensee from
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ever using any contract except TREC-approved forms.
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An agency responsibility that requires the agent to protect the client and place the client's interests above that of the agent is known as
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a fiduciary duty
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Mutual agreement to terminate a written agency agreement
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may be done orally
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Which statement by the listing broker to the buyer might lead a court to imply an agency relationship existed with the buyer?
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"Let's test the seller with a low offer and then go up if we have to."
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The type of listing that places listing brokers in a position of competing with their own clients to find a buyer is
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exclusive-agency listing.
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Both the buyer and seller gave written authorization for the broker to act as an intermediary but without appointments should the situation arise. The buyer expresses interest in seeing the seller's property. In regards to the intermediary transaction that now might arise, TRELA would require
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no further notification to the parties from the broker, although it would be prudent to do so.
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Which of the following factual comments to the seller by the seller's appointed licensee would be permitted even without the written permission of the buyer in a fully authorized intermediary relationship with appointments?
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"Offering to pay some of a buyer's closing costs often encourages them to make offers closer to the asking price."
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Errors and omissions insurance generally covers a broker and her associates for
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errors and mistakes made in common listing and selling activities.
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Which action of the broker is MOST likely to result in the creation of an agency relationship with the buyer?
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Negotiating on the buyer's behalf
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A real estate agent owes what level of obligation to a client?
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Highest fiduciary obligation
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Unless a defendant is found to have acted knowingly and/or intentionally, the damages under DTPA are limited to
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economic damages
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Which of the following is NOT a primary ingredient in the creation of an agency relationship?
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Compensation promised by the client
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An "unconscionable action" in the DTPA is a vague term that allows the courts to
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use their discretion in deciding cases where persons have been tricked or swindled.
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Due to the unique nature of the fiduciary duty of obedience, a licensee has an obligation to follow an unlawful instruction of a client under which circumstance?
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never
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A property manager broker manages a large 60-unit apartment complex for the owner, who has instructed the manager to limit the leases to 120 days. In regard to providing the statutory information about brokerage services to prospective tenants, the property manager is
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not exempt and must present the written statement to all prospective tenants.
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Price-fixing, boycotting, and allocating customers or markets are activities MOST relating to real estate brokerage violations of the
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federal antitrust laws
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The broker's legal and ethical obligation under a listing contract is to negotiate
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the best possible transaction for the client.
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Even though a broker is an agent for one party, she is obligated to treat both parties
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fairly
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An agency relationship with a buyer may be created by
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implication, an express written agreement, or an express oral agreement.
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With respect to listings in most MLS systems, any commission to be paid to the "other" broker by a listing broker is determined by agreement between the
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listing broker and the cooperating broker.
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A buyer is interested in finding a single-family residential property. One of the buyer's many requirements is that the local elementary school be a feeder school into the John Jay Middle School. A salesperson shows the buyer several properties meeting her various financial and size requirements. The buyer ultimately purchased a property but later found that the elementary school did not feed into John Jay Middle School. The salesperson does not have children and was not aware that the listing broker did not correct the MLS when the school boundaries changed in the fall. The salesperson
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did not misrepresent
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In the case of a second offer being received by the listing broker while the seller is awaiting a response to a counteroffer he has made to another buyer, the listing broker should
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present the second offer immediately but instruct the seller to be careful of accepting without first withdrawing the counteroffer to the first buyer.
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Delegation of authority by a client and acceptance of that authority by the agent
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are the core requirements to create an express agency relationship
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A licensee holds a real estate broker license but does not wish to run her own office. She may elect to contractually obligate and subordinate herself administratively to another broker to whom she is accountable. The contractually obligated broker is generally called a
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broker associate.
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Which of the following types of contracts must have a specific termination date?
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-Buyer representation agreements, listing agreements, and property management agreements -Independent contractor agreements between brokers and their associates -Buyer representation agreements and listing contracts
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What are federal antitrust laws intended to prevent?
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Excessive brokerage fee charges by any firm
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The TRELA mandates that all agency agreements must include a(n)
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definite termination date.
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TRELA holds brokers responsible to
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members of the public, TREC, and their clients.
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The Texas Real Estate Commission is responsible for
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-the administration of TRELA. -regulating employment contracts between brokers and independent contractors. -acting as arbitrator or mediator in disputes between brokers and consumers.
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In an intermediary transaction, the broker may appoint
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one or more licensed associates to communicate with and carry out instruction of the parties
