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59 Cards in this Set
- Front
- Back
North Carolina is a Caveat Emptor State. This Means? |
Buyer Beware -- Principles have NO affirmative duty to disclose known defects in property. |
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Agent
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one who is authorized to and consents to represent the interest of another person; in real estate, the firm is the agent |
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Sub-agent |
one who is employed by someone already acting as an agent; an agent of an agent |
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Principle |
the individual who hires and delegates to the agent the responsibility of representing his or her interests; this may be the buyer, seller, landlord, or tenant |
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Agency
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the fiduciary relationship between the principal and the agent |
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Sub-Agency |
the fiduciary relationship between the principal and the sub-agent |
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Fiduciary |
the relationship of trust in which the agent must do what is best for the principal, even if it is not best for the agent |
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Client |
is the principal; agents work for clients to give advice and counsel. |
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Customer |
is the third party to whom fairness and honesty is provided but who is not owed fiduciary; agents work with customers. |
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Brokerage
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the business of bringing parties together for the purpose of selling, renting, or exchanging property that requires licensing by an appropriate government authority |
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Broker |
a person who is licensed to list, lease, buy, exchange, auction, negotiate, or sell interest in real property for others and charges a fee for his or her services |
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Provisional broker |
a North Carolina licensee that must work under the supervision of a broker-in-charge; has not completed 90 hours of post- licensing education to remove provisional status |
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Cooperating broker/firm |
listing firm is authorized to employ and/or compensate other firms, usually members of the local MLS |
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Commission
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financial compensation for the successful completion of the contracted service |
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Universal agent |
a person empowered to do anything the principal could do personally, such as a universal power of attorney. The universal agent's authority is virtually limitless regarding actions taken on behalf of the principal; seldom seen in typical real estate transaction |
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General Agent |
One who represents the principal in a broad range of matters related to a particular business or activity |
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General Agent |
May be created by a general power of attorney; makes the agent an attorney-in-fact |
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The broker typically does not have this scope of authority in a real estate sales transaction for a consumer; property manager might be a general agent for the landlord. |
General Agent |
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Special Agent |
One who represents the principal in only one specific transaction or one business activity with limited detailed instructions. |
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The agent has limited authority; cannot enter into contracts on behalf of the principal and cannot bind the principal to any act |
Special Agent |
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The Listing Contract is between?
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The Seller and The Firm
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Buyer Agency Contract is Between |
The buyer and the Firm |
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Dual Agency agreement is between? |
The Firm and the buyer and seller in the same transaction. |
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Property Management Contract is Between? |
The Firm and the Owner (Landlord) or Property. |
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In-House Brokerage Employment Agreement is between? |
The Firm and the Real Estate Agent |
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Express Authority |
The parties state the terms of the agreement and express their intentions either orally or in writing |
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Implied Authority |
an agency created by implication because of the actions of both of the parties involved; not allowed by NC real estate license law |
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Apparent Authority |
Although no agreement in place, person acts as agent and principal accepts the actions of the agent through ratification; agency agreement created after the fact |
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Termination of Agency |
Commpletion or fulfillment of the purpose for which the agency was created |
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Termination of Agency |
Expiration of the terms |
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Termination of Agency |
Mutual Agreement to Terminate |
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Breach by one of the parties, such as abandonment by the agent or revocation by the principal (the breaching party might be liable for damages) |
Termination of Agency |
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By operation of law, as in a bankruptcy of the principal (since title to the property would be transferred to a court-appointed receiver) |
Termination of Agency |
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Termination of Agency |
destruction or condemnation of the property by eminent domain |
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death or incapacity of either party (notice of death is not necessary); death of individual agent will not terminate agency agreement if licensee worked for a brokerage firm since agency is with the firm, not the individual licensee |
Termination of Agency |
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Single Agency |
The firm represents either the seller or the buyer, not both in the same transaction; any third party is not a client |
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Possibility of Sub-Agency |
The broker appoints other cooperating firms/brokers who have the same fiduciary responsibilities as the listing broker; typical in MLSs |
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Can not sell own firm’s listings when working as buyer’s agent |
Single Agency |
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Buyer Agency |
The firm exclusively represents the buyer and does not list property for sale |
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SubAgency |
Listing firm appoints cooperating firms to assist in providing fiduciary duties for seller client |
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Undisclosed Dual Agency |
In real estate, the actions of the parties may create an agency relationship unintentionally, inadvertently, or accidentally where none was intended, leading to a ___________________. This is not permissible under NC license law. |
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Disclosed Dual Agency |
both principals must be informed and consent to the dual representation in writing. Parties must understand how the dual representation could affect their respective interests when the agent is essentially trying to impartially serve two masters. |
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Designated Dual Agency |
The firm acts as the dual agent and the BIC may appoint (designate) one in-house agent to represent only the buyer and another agent to represent only the seller. |
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True |
T/F An agent cannot be appointed as a designated agent if they have any prior confidential knowledge of the other party in the transaction. The agent's duty of confidentiality cannot be breached |
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False |
T/F Property Management Agreements can be Oral in the beginning. |
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When Must "Working With Real Estate Agents" Brochure be given to prospective client? |
First Substantial Contact |
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Agent's responsibilities to the principle under the Law of Agency |
Loyalty Obedience Accounting Disclosure of Information Skill, Care, Diligence |
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Agents responsibilities to Third Parties |
- Honesty & Fair Dealing - Disclosure of Material Facts that are or should be known by agent. - Compliance with Licensing Law and NCREC Rules |
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Puffing |
exaggeration of a property's benefits; legal as long as statements are not considered fraudulent |
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Material Fact |
is any fact that is important or relevant to the issue at hand and must be voluntarily disclosed to all parties to the transaction |
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Latent Defect |
a hidden defect that would not be uncovered by ordinary inspection; there is a duty to attempt to discover any latent defects that threaten structural soundness or personal safety |
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Willfull Misrepresentation |
intentionally misinforming a party about a material fact when agent has actual knowledge of the fact; also occurs when agent makes an incorrect informational statement without regard for the truth |
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Negligent Misrepresentation |
unintentionally giving inaccurate information to a party due of error or inaccurate information being known by the agent who should have reasonably have known the information to be in error. |
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Willful Omission |
intentionally withholding material fact that is known by the agent |
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Negligent Omission |
intentionally withholding material fact of which the agent is unaware but should reasonably have known even if agent is acting in good faith; agents have obligation to discover and disclose all material facts that any prudent agent should have discovered |
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Stigmatized Properties |
Society has branded property as undesirable because of events that occurred there, such as criminal events or other tragedies |
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True |
T/F Per NC law, the death or serious illness of an owner or resident of residential property is NOT a material fact. |
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True |
T/F The presence of a registered sex offender in or near a property is not considered by NC law to be a material fact |
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An agent who breaches duties to either the principal or third parties may be subject to |
1. Disciplinary action by the North Carolina Real Estate Commission 2. A civil action in court brought by the injured party 3. Criminal prosecution brought by the district attorney |