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New York Real Estate for Salespersons, 5th e

New York Real Estate for Salespersons, 5th e. By Marcia Darvin Spada , Cengage Learning. Chapter 2. Part I Law of Agency. Chapter 2 Key Terms. Accountability Advance informed consent to dual agency Agency disclosure form Agent Broker ’ s agent Buyer ’ s agent Client Confidentiality

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New York Real Estate for Salespersons, 5th e

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  1. New York Real Estate for Salespersons, 5th e By Marcia Darvin Spada, Cengage Learning Chapter 2 Part I Law of Agency

  2. Chapter 2 Part I Law of Agency Chapter 2 Part I Law of Agency

  3. Chapter 2 Key Terms Accountability Advance informed consent to dual agency Agency disclosure form Agent Broker’s agent Buyer’s agent Client Confidentiality Cooperating agent Customer Designated agent Disclosure Dual agent/dual agency Estoppel Exclusive agency Exclusive-right-to-sell Express agency Fiduciary/fiduciary duties First substantive contact Chapter 2 Part I Law of Agency

  4. Chapter 2 Key Terms (continued) General agent Implied agency Informed consent Loyalty Misrepresentation Obedience Open listing Principal Reasonable skill and care Self-dealing Seller’s agent Single agent Special agent Subagent Undisclosed dual agency Undivided loyalty Vicarious liability Chapter 2 Part I Law of Agency

  5. Agency Relationships Agent Principal Customer Chapter 2 Part I Law of Agency

  6. Broker EthicsFiduciary Responsibilities Obedience Loyalty Disclosure of information Confidentiality Accountability ReasonableCare, Skill, and Diligence Chapter 2 Part I Law of Agency

  7. Duties of the Principal to the Agent The agent should not be liable if the principal withholds information that causes the agent to make incorrect representations to third parties Agents should expect honest disclosure from customers Chapter 2 Part I Law of Agency

  8. Misrepresentation • A false representation of a material fact • A person making the false representation knew or should have known it to be false • A person acts or does not act based on the misrepresentation • A person who relies on the misrepresentation in acting or not acting Chapter 2 Part I Law of Agency

  9. Latent Defects • Hidden or concealed defects that cannot be discovered by ordinary examination or inspection • Buyers may accuse the inspector of failing to notice the problem • A leaky sewer pipe may cause damage to a number of property components Chapter 2 Part I Law of Agency

  10. Creation of Agency AGENCY AGREEMENT Express Oral or written Implied Actions of the parties Chapter 2 Part I Law of Agency

  11. Types of Compensation Chapter 2 Part I Law of Agency

  12. Multiple Listing Services • Advantages • Greater exposure for a listed property • Better price range due to a wider market • Property information online and updated regularly • Disadvantages • MLS charges a fee for its service- every broker or agent who accesses the service must pay • Courts have challenged MLS for only letting real estate board members become members • Listings are sold through a broker from another firm which because of the split reduces the commission Chapter 2 Part I Law of Agency

  13. Broker Ethics and Antitrust Laws Federal Antitrust Laws and Agencies Sherman Act (1890) Clayton Act (1914) Federal Trade Commission U.S. Dept. of Justice Chapter 2 Part I Law of Agency

  14. Types of Restraints of Trade Price fixing Group boycotts Market allocation agreements Tie-in arrangements Chapter 2 Part I Law of Agency

  15. Agency Alternatives Broker’s agent Buyer Agent Cooperating agent Designated agent Dual Agency Seller agent Single agent Subagent Chapter 2 Part I Law of Agency

  16. Definition of dual agent An agent who is acting as a buyer’s agent and a seller’s agent in the same transaction Chapter 2 Part I Law of Agency

  17. Dual agency Designated agent Consensual/ Informed consent Undisclosed Intended Unintended Chapter 2 Part I Law of Agency

  18. Designated Agent Definition A salesperson or associate broker, working under the supervision of a real estate broker, who has been assigned to represent a client when a different client is also represented by such real estate broker in the same transaction Chapter 2 Part I Law of Agency

  19. Designated Sales Associate The designated sales associate and representative broker cannot provide the fiduciary duty of undivided loyalty Both disclosure forms include a section on “dual agent withdesignated sales associates” Chapter 2 Part I Law of Agency

  20. Buyer Agency Fiduciary relationship with buyer Compensation from buyer/ seller or both Buyer client Buyer as customer Chapter 2 Part I Law of Agency

  21. The Listing Agreement Exclusive-right-to-sell Exclusive agency Open listing Exclusive-right-to-rent Exclusive-right-to represent ( buyer agency) Chapter 2 Part I Law of Agency

  22. The Agency Disclosure Form Sale or rental of 1-4 unit residential properties and condos and coops in any size building Informs consumers of their agency relationship and choices Used at the first substantive contact Advance informed consent Chapter 2 Part I Law of Agency

  23. Two Separate Agency Disclosure Forms Required One for seller/buyer transactions Another for landlord/tenant transactions Chapter 2 Part I Law of Agency

  24. Other Types of Disclosure • Agency • Agricultural districts • Electrical service • Lead-based paint • Mold • Property condition • Radon • Stigmatized Property • UFFI • Utility surcharge • Uncapped gas wells Chapter 2 Part I Law of Agency

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