Agency Law & Ethics Flashcards
6 cards from real RES practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Agency Law & Ethics flashcards as text
What fiduciary duties does a real estate agent owe their client?
Answer: Obedience, loyalty, disclosure, confidentiality, accounting, and reasonable care
The fiduciary duties (often remembered as OLD CAR) require agents to follow lawful instructions, put the client's interests first, disclose material facts, keep information confidential, account for funds, and exercise competence.
What is the difference between a buyer's agent and a seller's agent?
Answer: A buyer's agent represents the buyer's interests; a seller's agent (listing agent) represents the seller's interests
A buyer's agent has a fiduciary duty to the buyer, helping them find and negotiate the best deal. A seller's agent (listing agent) represents the seller, working to get the highest price and best terms.
What must a real estate agent disclose to potential buyers about a property?
Answer: All known material facts that could affect the property's value or desirability
Agents must disclose all known material facts including structural defects, environmental hazards, neighborhood issues, and any condition that might affect a reasonable buyer's decision, regardless of the seller's wishes.
What is the Fair Housing Act and what does it prohibit?
Answer: A federal law prohibiting discrimination in housing based on race, color, religion, sex, national origin, disability, and familial status
The Fair Housing Act (Title VIII of the Civil Rights Act of 1968, as amended) prohibits discrimination in the sale, rental, and financing of housing based on seven protected classes.
What is steering in real estate?
Answer: The illegal practice of directing buyers toward or away from neighborhoods based on protected class characteristics
Steering violates the Fair Housing Act by directing prospective buyers or renters toward or away from certain neighborhoods based on race, religion, national origin, or other protected characteristics.
What is a listing agreement?
Answer: A contract between a property owner and a real estate broker authorizing the broker to market and sell the property
A listing agreement establishes the agency relationship between seller and broker, defining the broker's authority, commission rate, listing price, duration, and marketing responsibilities.