- the rules established by tradition and court decisions
Statutory law
- the law enacted by legislature- after the fact
Administrative law
- the rules and regulations created by a real estate commissions and departments as authorized by legislature
- Part of agency
Agent
.
- is a person authorized to act on behalf of the principal in dealing with a third person
- represents Principal
- sales associate of a RE broker act as agent (representative) of the broker
- sales associate have the same relationship to a client of the firm that the broker does
Agent represents?
Principal
Principal
- individual who hires the agent
- buyer or seller
- landlord or tenant
Agency
.
- fiduciary relationship between the principal and the agent
- agent is authorized to represent the principal in one or more transactions
Fiduciary relationship between the principal and the agent
Agency
Fiduciary relationship
- relationship in which the agent is held in a position of special trust and confidence by the principal
Relationship in which the agent is held in a position of special trust and confidence by the principal
Fiduciary relationship
Client
.
- is the principal in a RE transaction for whom a real estate broker acts as agent and gives advice and counsel - agent represents client
Principal in a RE transaction for whom a real estate broker acts as agent and gives advice and counsel
Client
Customer
.
- the 3rd party or non-represented consumer who is not a principle but for whom some level of service may be provided
- entitled to fairness and honesty - may be represented by a separate agent
The 3rd party or non-represented consumer who is not a principle but for whom some level of service may be provided
Customer
Nonagent
- or (5)
.
- another names
- facilitator
- intermediary
- transactional broker
- transaction coordinator
- contract broker
- someone who works with a buyer and seller (or a landlord and tenant) assistant one or both parties with the transaction without representation either party's interest
Someone who works with a buyer and seller (or a landlord and tenant) assistant one or both parties with the transaction without representation either party's interest (6)
- Nonagent
- facilitator
- intermediary
- transactional broker
- transaction coordinator
- contract broker
facilitator
Nonagent
intermediary
Nonagent
transactional broker
Nonagent
transaction coordinator
Nonagent
contract broker
Nonagent
Single Agent
- represents...
- works for
.
- represents only one of the parties to a transaction
.
- works for
.
- principal (client)
- entrusted with certain confidential information
- has fiduciary responsibilities
- client can expect full disclosure of all relevant information
.
- customer
- customer is entitled for factual information and fair and honest dealing
- but does not receive advice and console
Principal's responsibilities (3)
1) comply with the agency agreement
2) cooperate with the reasonable expectation of the agent
3) compensate the agent
Agent's responsibilities
Fiduciary (COLD-AC) duties to the principal
Express agency created by
by Express agreement
Express agreement may be
may be oral or written
In Express agency parties formally expressed their intention to
- establish an agency
and
- state its terms and conditions
Listing Agreement
.
- Seller Representation Agreement (Contract)
- agency relationship between a RE seller and a broker
- authorizes the broker to find a buyer or tenant for the owner's property
Agency relationship between a seller and a broker
- Listing Agreement
- Seller Representation Agreement (Contract)
Buyer Representation Agreement
.
- Express agency relationship between a buyer and a broker
- authorizes the broker to find the appropriate property
Express agency relationship between a buyer and a broker
Buyer Representation Agreement
Implied agency
.
- set of events
- result of parties' behavior
- parties act as
- they have mutually consented to an agency
- they have not entered into a formal agency agreement.
- CT prohibit the creation of agency implied by conduct
Agency created by set of event as a result of parties' behavior
Implied agency
Agency in which parties act as they have mutually consented to an agency, but have not entered into a formal agency agreement
Implied agency
Gratuitous Agency
- agency with no fee involved
agency with no fee involved
Gratuitous Agency
Real Estate Sales Associate can only receive compensation from...
... the sales associate Employing Broker
Fiduciary responsibilities
- RE broker owes the principal certain (Fiduciary) duties
COLD-AC
Care
Obedience
Loyalty
Disclosure
|
Accounting
Confidentiality
Care
- Fiduciary responsibility
- the representative is liable to the principal for any loss resulting from the representative's negligence or carelessness
Obedience
.
- Fiduciary responsibility
- Listening the client and show what client wants (only legal)
- disclose Material Facts
- obeying the principle's lawful instructions in accordance with the contract
Loyalty
.
- Fiduciary responsibility
- client’s interest first
Disclosure (4)
.
- Fiduciary responsibility
- information that must be disclosed could include
1) Any relationships the purchasers might have with the agent)
2) Purchasers’ ability to complete the sale or offer higher price
3) Any interest or prospective interests the agent has in the buyer or the buyer’s business
4) An incorrect market value of the property
Fiduciary responsibility in which the representative is liable to the principal for any loss resulting from the representative's negligence or carelessness
Care
Fiduciary responsibility in which agent listening the client and show what client wants (only legal)
Obedience
- Fiduciary responsibility in which agent discloses Material Facts
Obedience
- Fiduciary responsibility in which the agent obeying the principle's lawful instructions in accordance with the contract
Obedience
Fiduciary responsibility in which client’s interest first
Loyalty
Information that must be disclosed to client
1) Material Facts
2) Any relationships the purchasers might have with the agent)
3) Purchasers’ ability to complete the sale or offer higher price
4) Any interest or prospective interests the agent has in the buyer or the buyer’s business
5) An incorrect market value of the property
Selling property “as-is”
- a buyer is free to accept a property in its current condition but has the right to know what that condition is
Confidentiality
.
- Fiduciary responsibility
- confidential personal information
Universal Agent
- is a person improved to do anything the principal could do personally
- virtually Unlimited
- Court Appointed
Agent improved to do anything the principal could do personally is a...
Universal Agent
General Agent
- may represent the principal in a broad range of matters related to a particular business or activity
- Property manager
Agent that may represent the principal in a broad range of matters related to a particular business or activity
General Agent
Special Agent
- or
- or limited agent
- is authorized to represent the principal in one specific act or business transaction only
- Realtor
Limited Agent
- or
- Special Agent
- is authorized to represent the principal in one specific act or business transaction only
- Realtor
Agent that authorized to represent the principal in one specific act or business transaction only
- Special Agent
- Realtor
When Disclosure of Agency must be done?
- before any confidential information is disclosed
Single Agency
- agent represents only one party (either sellers and buyers – or landlord or tenants) to a transaction
What kind of agency relationship b/w a RE broker and Sales Associate of that broker
Single Agency
Listing Contract
- document that usually forms the agency relationship of broker and seller
Agreement in which an owner may employ a broker to market, lease, maintain or manage the owner’s property
Property Management
Property Management
- is an agreement in which an owner may employ a broker to
- market
- lease
- maintain
- manage the owner’s property
Dual Agency
- agent represents two principals (seller and buyer) in the same transaction
- requires equal loyalty at the same time
- neither principal has the full, undivided loyalty of the agent
- dual agent can never fully represent either party’s interest
Disclosed Dual Agency is intended to
- to minimize the risk for the broker
Undisclosed Dual Agency
- it might occur unintentionally or inadvertently
- can
- create an Implied Agency (not written or oral)
- violate the duties of loyalty and confidentiality to the principal selle
Designated Agency (2)
- kind of Dual Agency
- or assigned agency
- or appointed agency
- to accomplish “in-house” sale
- two sales associates of the same broker are involved (one represents seller and another represents buyer)
Assigned agency
- kind of Dual Agency
- or Designated Agency
- or appointed agency
- to accomplish “in-house” sale
- two sales associates of the same broker are involved (one represents seller and another represents buyer)
Appointed agency
- kind of Dual Agency
- or Designated Agency
- or Assigned agency
- to accomplish “in-house” sale
- two sales associates of the same broker are involved (one represents seller and another represents buyer)
In what agency two sales associates of the same broker are involved (one represents seller and another represents buyer)