Real Estate Course Level 9 Flashcards

Real Estate Course Level 9 Flashcards Forms of AgencySingle Agency: Agent ----> ClientSubagency: Agent ---->

Client, subagent works with both.Dual Agency: Agent

works with 2 clients (buyer and seller).Designated Agency:

Same Broker has 2 agents with 2 clients buyer and seller

on a transaction.No Agency: Agent has no fiduciary duties

with clients.Transaction CoordinatorA transaction coordinator, a.k.a. facilitator or intermediary, is a broker who facilitates a transaction absent of any agency relationship with either party to the contract.The broker has no fiduciary duties for ministerial acts they perform. When this occurs, it is known as no agency.In Georgia, a transaction coordinator is sometimes called a middleman, and the theory of no agency is sometimes

called the middleman principle.Pro tip: It makes sense that

agents who practice no agency are called transaction

coordinators, facilitators, or intermediaries:. They ONLY

coordinate or facilitate a transaction anddon't involve those complicated and binding fiduciaryduties.. They act as ONLY intermediaries between buyers andsellers, landlords and tenants.For the most part, I'll be referring to agents practicing no agency as transaction coordinators, but I might throw in the other terms to keep you on your toes.

Just know they all mean the same thing.Takeaway:

Transaction coordinators do not enter into an agency relationship with either party to the transaction.What That

Looks Like:In the absence of an agency relationship (and

fiduciary duties), the transaction coordinator does not represent the interests of one principal over the other.Instead, they fulfill ministerial acts to assist in the completion of the transaction. So, a transaction coordinator

will:. Handle funds, documents, and other materials..

Present all offers and counteroffers.. Keep parties informed of progress in the transaction.. Assist in closing the transaction.They're kind of like an impartial parent to two opposing children.Landlord's AgentA landlord's agent is similar to a seller's agent. The landlord's agent is a single agent who has agreed to represent the landlord's interests in a real estate transaction (to lease, not sell, a property). The landlord is the principal/client of the landlord's agent, and the landlord's agent owes all fiduciary duties to the

landlord.The agency relationship between the landlord and the landlord's agent is documented in a listing agreement.The landlord's agent works for the landlord and with the tenant.A landlord's agent can also be involved in property management, something we'll talk about later.First Substantive ContactYou know I didn't forget about first substantive contact and disclosures! We've already talked about this throughout the chapter, but it's worth noting one more time, especially because dual agency is trickier than other forms of agency.An agent may obtain advance informed consent in

writing to operate as a dual agent during their first substantive contact with a client, even if that agent plans to operate as a single agent. This is often called advance consent to dual agency.This means that the customer is entering into a single agency relationship but agrees to dual agency in the future, should that opportunity arise.This is usually only sought out by brokers who practice dual agency (otherwise, it wouldn't be very useful).However, as you've learned in this chapter, dual agency can come as a surprise or accident. It's always a good idea to obtain new, clear, informed consent from a client if an agency relationship shifts to dual agency - even if the client agreed to it previously.If a client did not consent to dual agency previously, it is especially crucial agents disclose their dual agency and obtain informed consent from their clients. If not, that is undisclosed dual agency (and a really bad idea).But, as soon as a relationship begins to morph into dual agency, disclose it even if advance consent was previously given.Quiz Level 9b) Ministerial acts include making factual comparisons.Ministerial acts are acts that are purely fact-based. They don't require judgement, and they don't provide any counsel, advice, or moral guidance.Which of the following is TRUE of ministerial acts?a) Ministerial acts provide moral guidance.b) Ministerial acts include making factual comparisons.c) Ministerial acts provide counsel.d) Ministerial acts include giving advice.

Compensation Paid By...Let's look at how compensation works in different scenarios, when compensation is paid by:The Seller:When a listing broker takes on a client as their principal, the

broker negotiates:. How compensation is earned. What

form compensation will take. Who will be eligible for compensation**This includes cooperating brokers operating as the principal's subagent or a buyer's agent.Understandably, the amounts or percentages a seller agrees to pay a cooperative broker could vary. It depends on what roles the cooperating broker plays and what they

negotiate in the agreement.The Buyer:When a buyer enters

into a buyer-broker agreement with a broker, they negotiate how the buyer broker will be compensated. Often, there is language stating that the buyer broker's compensation will come from the commission split offered by the seller (as outlined in the MLS).Even then, the buyer-broker agreement typically ensures compensation for the buyer broker in the event compensation is not derived from the seller. So no matter what happens, you'll get paid.Multiple

Parties:There may even be occasions when a broker is

eligible to receive compensation from both the buyer and seller. While that sounds like heaven, a license holder needs to tread carefully in these situations to stay on the right side of licensing law.In order to legally receive compensation from both parties in a real estate transaction,

a license holder MUST:. Fully disclose to all parties to the

transaction that theyare receiving compensation from both sides. Receive informed consent (in writing) to thisarrangement of joint compensation from both partiesDual Agency: Dual Compensation:Speaking of compensation from multiple parties, it's important to note that dual agency poses some particularly sticky problems when it comes to compensation.You already know that in dual agency, a broker represents both sides of a transaction. This means that they can get paid by both parties to the transaction. But there are many, many caveats to dual agency. As a licensee, you'll need to provide disclosure regarding the dual compensation and obtain informed consent from both parties before proceeding.Facts of a Feather Level 9b) single agency. Buyer-only agents practice this form of agency.a) dual agency.b) single agency.c) subagency.d) no agency.

Guided PracticeAnswer: As a transaction coordinator, Irma

must be impartial to both parties to the transaction. This means that she should NOT inspect the property and