Rockwell: Washington Real Estate Practices Flashcards

Rockwell: Washington Real Estate Practices Flashcards

Are you required to tell any confidential information that a third party tells you to your principal?Yes. You do not owe the third party loyalty or confidentiality, but you do to your principal.This Washington statute incorporated some of the common law of agency but also changed many aspects of an agent's duties.Real Estate Brokerage Relationships Act.ClientThe person that the agent is authorized to represent.AKA Principal.If you are viewing a property with a client owned by a corporation in which you own shares, are you required to disclose that conflict of interest?Yes, by duty of disclosing conflicts of interest.Under what 5 criteria does Washington law define confidential information?

Information concerning a principal that:-Was acquired by

the licensee during the course of an agency relationship.-The principal reasonably expects to be kept confidential.-The principal has not disclosed or authorized to be disclosed to third parties.-Would, if disclosed operate to the detriment of the principal.-The principal personally would not be obligated to disclose to the other party.Can the agency disclosure be made orally? No, it must be in writing.Cooperating AgentsAll agents involved in a transaction.Latent DefectA hidden structural defect that would not be discovered by ordinary inspection.When does the duty of good faith and continuous effort end?When the purpose of the agency has been fulfilled.Once a seller/buyer signs an offer.What are the two categories of real estate agent duties?Duties owed to principal and duties owed to any party.A house that you are showing to a potential buyer belongs to a good friend of yours from college. You are bound to share this fact with the buyer. True or false?True, by duty of disclosure of conflict of interest.What name is to put on the "Real Estate Firm" portion of the purchase and sale?The name of the brokerage.What are the four ways agency can be terminated by operation of law?Expiration.Fulfillment of purpose.Death or incapacity.Extinction of subject matter.Is the agent required to investigate the other party's financial position?No.Are you required to disclose murders, gang activity, and other information that does not directly affect title or value?No. But you should by good duty if it suits the context.Are you ever allowed to mix your money with the trust fund money?No. That's commingling.Managing BrokerPerson who performs real estate brokerage services on behalf of a real estate firm, under the supervision of a designated broker.

AgentA person who acts or does business for another.What are the 4 planning items you must have before starting your real estate business?Business plan.Budget.Cash reserves plan.Start-up expenses.Problems which would not be apparent in an ordinary

inspection must be disclosed; these are known as:

latent defects.PrincipalThe person that an agent is authorized to represent.AKA Client.Is a managing broker allowed to supervise other licensees?Only with authorization from the designated broker.Does the agency disclosure need to be signed? Yes. It must be signed before any parties sign any other documents.Can an agency just be terminated between parties orally?Yes, but if it was made in writing, it is advised to be terminated in writing.What are the two types of agency termination? Termination by action of parties or by operation of law.What license must a branch manager have? A managing broker's license because they will be supervising other licensees.Do you owe any duties to parties when acting as a non-agent?Yes, you still owe the 7 duties owed to any party.What does the Real Estate Brokerage Relationships Act change about buyer agency relationships?It presumes that the licensee working the buyer is the buyer's agent unless there is a written agreement to the contrary (such as a listing agreement).A failure to act in accordance with the disclosures you made might be punished with a fine up to $10,000 per violation. True or false?False, the max they can fine you is $5,000.An inspection has revealed that the house you are trying to sell has termites in the foundation. If you client tells you to keep that confidential, you are bound to keep silent about that. True or false?False, you have the duty to all parties to disclose material facts and can legally be implicated if it is found out.Are you required to give the seller new offers after they had already accepted one? Even if it's lower?Yes. ALL offers are to be delivered asap.Can you be accused of negligence if you relay information that comes from an unreliable source?Yes.Who are the four parties in a typical real estate transactions?Buyer.Seller.Listing agent.Selling agent.How are buyer agencies created under Washington Real Estate Agency Law?Express agreement (in writing)By law (implied by providing real estate services) unless there's a written agreement to the contrary.What law set forward agent responsibilities? Real Estate Brokerage Relationships Act in the Washington's Real Estate Agency Law.Are you required to disclose about drug manufacturing on the property?Yes, if it hasn't been decontaminated and it affects the physical condition of the property. If it has been resolved, no.When must the agency disclosure be presented? Before the party signs an offer.Can you encourage a seller to accept a particular offer in sole effort to get your commission sooner?No, that violates the duty of loyalty.

Does vicarious liability apply to designated brokers or managing brokers?Yes. They are liable for their licensee.The buyer you are working with signs a purchase and sale agreement. You are obligated to keep finding possible homes for him in case something goes wrong with the first deal. True or false?False. The duty of continuous effort ends as soon as they have selected a deal.What is best practice if you don't know the facts to something?To admit that you don't know or remain silent to avoid misrepresentation.What are the 6 sanctions that the DOL can impose if you fail to act in accordance with your agency disclosure?-Suspension or revocation of license.-Restriction or monitoring of your real estate activities.-Fine of up to $5000 per violation.-Probation.-Completion of a relevant real estate course.-Censure or reprimand.A big book (education) with a penis (probation) and a camera (monitoring) comes up to you to rip up your license (suspension) and tape your mouth with a $5 bill (fine), then yells at you (censure).What are the additional 5 duties that an agent owes to their principal?-Loyalty.-Disclose conflicts of interest.-Confidentiality.-Expert advice.-Good faith and continuous effort.The principal has a dogThat barks at other people.But in silence.Has a collar full of tags of names.and an infinity pattern on it's back.Does an agent need to independently verify statements from reasonably reliable sources?No.As the seller's agent, can you help the buyer by explaining the process of presenting the offer, negotiation, and closing the transaction?Yes.When was the Washington Brokerage Relationships Act formed and why?It was formed in 1997 because there was a lot of confusion as to who represented who, which caused inadvertent dual-agency, and what duties are owed by the agent.A dual agent may disclose confidential information about a buyer to a seller, so long as it is not about what the buyer's final offer will be. True or false?False. The agent owes the duty of confidentiality to both parties.Inadvertent Dual AgencyOccurs when a real estate agent whilerepresenting one party to a transaction, unintentionally becomes the agent of the other party -- a dual agent --by leading the other party to believe he is acting as their agent. Illegal.Someone who has been authorized by a person to

represent that person in dealings with third parties is a(n):

Agent.Non-agencyThe licensee does not represent either party in the transaction.When a licensee is not performing the minimum services required under an exclusive brokerage agreement, and is, therefore, not acting as the consumer's agent.Failure to make a required disclosure can be punished by suspension or revocation of your license, or by having to take a relevant real estate course. True or false?True.

If you know confidential information from a previous agency relationship with a buyer that could benefit your present seller, can you disclose that?No. You will always owe all of your relationships the duty of confidentiality. If they disclosed information to you during your agency, it is meant to be between you.A person who authorizes an agent to represent them is

a(n):

Principal.What did Washington real estate agency law change about vicarious liability?It is not in practice in Washington. A principal is not generally liable for harm caused by a real estate agent.As the seller's agent, can you help the buyer secure financing?Yes.Is an agent required to actively discover material facts to disclose?No.A real estate license is working as a property manager. He signs a contract with a company for some roof repair services. If this was within the scope of the licensee's agency authority, the property owner is bound by this contract. True or false?True. A principal is bound to their agent's actions.If you are the listing agent, what must you do if a buyer has had a previous agency relationship with you?You must be clear and disclose agency status to the buyer.Avoid acting like the buyer's agent.Even if an offer is ridiculously low, you are bound to

present it to a seller under the duty to:

present written communications.Commission SplitA method of sharing commission between brokerage and agent.If you buying/selling a property yourself, can you represent the other party?No. Ask your managing broker to review the contracts or ask them to get representation.If you are selling your own house, you must disclose to a potential buyer that you are a licensed real estate agent in the state of Washington. True or false?True.You must also disclose that you are buying/selling for your own benefit, and plan to make a profit.As a seller's agent, can you help the buyer fill out the purchase offer form?Yes.Under common law, an agency relationship may be created through express agreement, ratification, estoppel, or implication. True or false?True.Can you disclose information about the principal after the agency terminates?No, you still owe the duty of confidentiality and accounting after the agency terminates.Selling Agent vs Listing AgentSelling agent: The one who procures the a buyer for the property, but doesn't necessarily have the listing.Listing

agent: The agent that markets the home for sale.

Agency Law PamphletPamphlet with the actual provisions of Washington's real estate law. Required to be given to principals of parties before they sign an agency agreement.In what cases can a principal be held to vicarious liability?If they knew what was happening and didn't stop it or participated.If they benefitted from it.If an agent's negligence causes one of the parties financial loss, will they be required to pay compensation?Yes, because of the duty of reasonable care and skill.