Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
28 Cards in this Set
- Front
- Back
|
A transaction broker has which of the following duties to a buyer? To advise the buyer regarding the transaction To verify the measurements of a property being purchased To offer personal opinions regarding desirability of a neighborhood To communicate to the seller what the buyer's motivating factors are |
A: To advise the buyer regarding the transaction A transaction broker advises the parties regarding the transaction. They may NOT give buyers their personal opinions. |
|
|
Broker Brown met buyers (the Bakers) at an open house. They established good rapport with each other, and the purchasers signed an exclusive right-to-buy contract with broker Brown. The Bakers called Brown on numerous occasions to make an appointment to view properties. In each case Brown had a previous engagement. Finally the Baker’s found a home they wanted at a house that was being held open by another broker and the Baker’s purchased the property through that broker. When Brown learned of the transaction he demanded his commission, claiming it was rightfully his as a result of the exclusive right-to-buy contract. Broker Brown: is entitled to receive his commission under the terms of the Exclusive Right to Buy agreement did not fulfill his obligations under the terms of the Exclusive Right to Buy agreement and is likely not entitled to receive a commission should receive a referral fee from the broker holding the open house as the buyers are rightfully his none of the above |
A: did not fulfill his obligations under the terms of the Exclusive Right to Buy agreement and is likely not entitled to receive a commission Broker Brown did not fulfill his obligations under the terms of the contract. Broker Brown has not earned a commission. He was obligated to be available when the Bakers' wanted to view properties. By not being reasonably available, he breached the contract. |
|
|
Pursuant to an exclusive right-to-buy contract, a broker: may always show the same property to another buyer may not show the same property to more than one buyer may show the same property to another buyer only if a buyer-agency relationship has been established may show the same property to another buyer only if a transaction broker relationship has been established |
A: may always show the same property to another buyer The exclusive right to buy contract contains a clause authorizing the broker to show properties to more than one buyer. |
|
|
In a buyer-agency situation, what responsibility does the principal have to the agent? To present all offers in a timely manner To account for funds A fiduciary responsibility He may have to pay a commission |
A: He may have to pay a commission The buyer is required to pay a commission. The broker is required to present all offers in a timely manner, account for funds and be loyal. |
|
|
How is the relationship handled when a buyer wishes to work with a broker to locate property to purchase? Brokerage will be an agent for the buyer unless there is written agreement for another relationship. Buyer and broker must sign an exclusive representation agreement. Buyer will be a customer with no working relationship to the brokerage company. Buyer and broker may agree to a relationship which could include agency, transaction-brokerage, or no working relationship between the parties |
A: Buyer and broker may agree to a relationship which could include agency, transaction-brokerage, or no working relationship between the parties The buyer has many options: he or she can be a unrepresented "customer" after appropriate disclosure, can sign an agency representation agreement, or can hire the broker as a transaction-broker either in an exclusive arrangement, oral agreement, or by default. |
|
|
In a transaction broker situation, what responsibility does the principal have to the agent? To present all offers in a timely manner To account for funds A fiduciary responsibility He may have to pay a commission |
A: He may have to pay a commission Pursuant to the terms of an exclusive right to buy contract the buyer may be obligated to pay a commission. |
|
|
A transaction broker may disclose the following information regarding a buyer he is assisting, in the purchase of a property: that the buyer is willing to pay more for the property than he offered what the buyer's motivation to purchase the property is adverse material facts regarding the buyer's financial ability to purchase the property what the buyer's race and country of origin is |
A: adverse material facts regarding the buyer's financial ability to purchase the property The buyer’s financial ability to purchase the property is considered a fact, which must be disclosed to a seller. |
|
|
In a legally binding contract consideration could be: A refrigerator Money A promise All of the above |
A: All of the above Consideration can be cash, something of value or a promise |
|
|
The buyer agent of company P closed on a property on Tuesday. The buyer agent should bring the completed file and commission check to the broker: as soon as possible by Friday after dinner and a celebration cocktail before the property closes |
A: as soon as possible Files need to be kept in the office unless removed for signatures or closing, then they must be returned ASAP. |
|
|
Broker Beatrice meets with buyer Bob, and together they negotiate the terms of an exclusive right-to-buy contract. Buyer Bob is unrealistic in his expectations of properties available in his price range, and after looking at several houses decides to wait until next year and save some more money before making a purchase. In regards to the exclusive right-to-buy contract, which of the following is true? Beatrice may retain the contract in her original files until next year Beatrice may destroy the contract, as it never came to fruition Beatrice must submit the contract to the office to be retained with all other permanent records Beatrice can hold on to the contract and use it again next year |
A: Beatrice must submit the contract to the office to be retained with all other permanent records All contracts must remain with the permanent records of the office. Exclusive right to buy contracts expire in one year, so a new contract will be needed. |
|
|
The length of the holdover period in the exclusive right-to-buy contract is best described as: a maximum of 120 days a maximum of 180 days a freely negotiable period a freely negotiable period that may be invalidated when the buyer signs a new exclusive right-to-buy contract |
A: a freely negotiable period that may be invalidated when the buyer signs a new exclusive right-to-buy contract The Holdover Period says that a broker may be entitled to a commission after the expiration of a buyer agency contract for the period of time specified in the clause if: 1) the broker negotiated with the seller during the listing period and 2) the broker submitted the name of this seller in writing to the buyer. Although the protection is for a negotiated time after the agreement expires; it can terminate early if the buyer signs another buyer agency agreement with another agent and the "Shall Not" box is checked, meaning the old agent "shall not" be owed a commission if another brokerage firm has earned one. If neither the "Shall" or "Shall Not" be owned a commission" box is checked - the default is "Shall Not". See "Holdover Period" in the "When Earned" clause of an Exclusive Right to Buy agreement. |
|
|
In the absence of an exclusive right-to-buy contract, a buyer may: look at houses with more than one agent in the same day look at the same house with more than one agent in the same day look at houses with a broker and then purchase a home being held open by another broker in the same day all of the above |
A: all of the above A buyer may always look at a property with any agent. The exclusive right to buy contract prohibits buyers from working with other agents unless their agent has breached the contract with them. |
|
|
All of the following are true in the Colorado Right to Buy Contract except: That the broker may be compensated by the seller Allows for the broker to be an agent for the sellers as well as the buyers May provide that the broker be paid an hourly rate Must have definite termination date |
A: Allows for the broker to be an agent for the sellers as well as the buyers The broker cannot represent both parties in the same transaction as an agent, but may help or assist both as a transaction broker. |
|
|
The real estate broker is liable to the buyer if he: executes a contract in the seller’s name after proper power of attorney authorization acts in excess of the authority given by his principal makes statements based on misrepresentations by the seller gives buyer’s earnest money to seller and sale later fails through no fault of agent |
A: acts in excess of the authority given by his principal A broker may be held liable for acting in excess of his authority but, normally, not for making a misrepresentation based on statements from the owner. Executing a contract in the name of the principal or acting in excess of the authority given to him by the principal would make him liable to the principal not the buyer. |
|
|
In the Exclusive Right to Buy Contract, who is responsible with regard to registered sex offenders? Sex offenders privacy rights are protected by state and federal law Sellers will be required to disclose any sex offenders in the neighborhood Buyers must obtain this information from local law enforcement agencies Brokers must disclose the presence of any known sex offenders |
A: It is the buyer's responsibility to do research to find out about registered sex offenders that may be living in the neighborhood. |
|
|
The exclusive right-to-buy contract is available as: various sizes and shapes multiple flavors different colors buyer-agency and transaction broker relationships |
A: buyer-agency and transaction broker relationships Exclusive tight to buy contracts can establish either buyer agency or transaction brokerage depending upon which box is checked at the top of the contract. If no box is checked it will be assumed to be a transaction broker relationship. |
|
|
When an exclusive right-to-buy contract has been executed, who is obligated to pay the broker working with the buyer? The seller The listing broker The buyer It is determined by which box or boxes are checked in the contract. |
A: It is determined by which box or boxes are checked in the contract. Whichever box or boxes are checked in the contract is who has to pay . See para. 7.1, 7.2 (all), and 7.3. of Exclusive-Right-To-Buy Contract. |
|
|
In Colorado in the event that an exclusive right-to-buy contract is not signed by a buyer, the default relationship is that of a: buyer-broker relationship dual agency relationship seller-agency relationship transaction broker relationship |
A: transaction broker relationship In the absence of a contractual agreement, transaction brokerage is created. |
|
|
An agent and buyer enter into an Exclusive Right to Buy Contract, the Broker must be a buyer's agent Buyer may have agreements with several brokers The broker is bound to work with one buyer at a time Buyer is bound to work with only one broker during the term of the contract |
A: Buyer is bound to work with only one broker during the term of the contract The buyer agrees to only work with one broker with the Exclusive Right to Buy Contract regardless of whether it is an Agency or TB contract. |
|
|
Agency disclosure does not have to be made to a buyer under which of the following circumstances? Showing a home at an open house When responding to general factual questions concerning advertised properties During "small talk" regarding general price range, location, property styles, etc. All of the above |
A: All of the above You need to disclose your brokerage relationship in writing before engaging in any activity which requires a brokerage license. Commission rule E-35 states that "brokerage activities" occur when a broker elicits or accepts confidential information from a party concerning specific real estate needs, motivations, or financial qualifications. Activities such as open house, preliminary conversations, or small talk concerning price range, location, property styles, or responding to general factual questions about properties that have been advertised for sale or lease do not qualify as triggering brokerage activities. |
|
|
The alternative dispute resolution, mediation clause, in the exclusive right-to-buy contract is for the purpose of: limiting the time period for disputes to 30 days encouraging alternatives to litigation, reduce the cost of resolving disputes all of the above |
A: all of the above The mediation clause in the exclusive right to buy contract limits the time prior to litigation to 30 days and is designed to reduce the cost of dispute resolution. |
|
|
An Open Listing, an Exclusive Brokerage listing and an Exclusive Right-To-Sell listing all require: A lockbox to be used A definite termination date The property to be entered into an MLS The broker to offer compensation |
A: A definite termination date Money, lockboxes and use of MLS are optional. The use of a definite termination date for the agreement is not. Real Estate Commission rule E-11 does not allow open-ended contracts with Brokerage firms Reference Commission Rule E-11 |
|
|
If the buyer assigns her right to purchase a property pursuant to an exclusive right-to-buy contract to her brother-in-law: the broker is no longer entitled to a commission the broker shall still have the right to collect a commission the broker may only collect a commission if the brother-in-law signs an exclusive right-to-buy contract the broker may only collect a commission if the listing broker feels that the selling broker has earned it |
A: the broker shall still have the right to collect a commission The brokers right to collect a commission is specifically protected in the exclusive right to buy contract, even if the buyers right to purchase is assigned to another party. |
|
|
What is the maximum commission rate that a buyer may be charged pursuant to an exclusive right-to-buy contract? 0.028 0.03 0.07 none of the above |
A: none of the above Anti-trust laws prohibit price fixing. There is no maximum. All commissions are negotiable. |
|
|
Proper disclosure of brokerage relationships must be made: verbally personally by the employing broker in writing with witnesses |
A: in writing You need to disclose your brokerage relationship in writing before engaging in any activity which requires a brokerage license. Commission rule E-35 states that "brokerage activities" occur when a broker elicits or accepts confidential information from a party concerning specific real estate needs, motivations, or financial qualifications. Activities such as openhouse, preliminary conversations, or small talk concerning price range, location, property styles, or repsonding to general factual questions about properties that have been advertised for sale or lease do not qualify as triggering brokerage activities. |
|
|
The buyer's legal procedure to enforce a contract is: Lis pendens Specific performance An attachment An injunction |
A: Specific performance Specific performance is buyers legal remedy to enforce the terms of the contract |
|
|
Under an Exclusive Buyer Agency Agreement, the broker has what agency relationship to the purchaser? Principal Fiduciary Transaction Broker Client |
A: Fiduciary Any time agency is established the broker has a fiduciary responsibility. A fiduciary relationship is one where one person places complete confidence in another in regard to a particular transaction or one's general affairs or business. |
|
|
From whom may the buyer's sales agent receive payment for their services? Anyone Their broker only The listing agent's broker Their client |
A: Their broker only All contracts are with the company, not the agent. The company receives payment from the client and then compensates the agent. An associate broker may only receive their commission from their broker. |
