Accounting /Virginia Real Estate Principles - Unit 9: Real Estate Agency
Virginia Real Estate Principles - Unit 9: Real Estate Agency
This deck covers key concepts and definitions related to real estate agency principles, including types of agents, agency relationships, and important legal terms.
Agency
The relationship between a principal and an agent wherein the agent is authorized to represent the principal in certain transactions.
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Key Terms
Term
Definition
Agency
The relationship between a principal and an agent wherein the agent is authorized to represent the principal in certain transactions.
Agent
One who acts or has the power to act for another. A fiduciary relationship is created under the law of agency when a property owner, as the principal,...
Buyer Representation Agreement
A principal-agent relationship in which the real estate professional acts on behalf of the buyer, usually as an agent, with fiduciary responsibilities...
Buyer’s Agent
A real estate professional who is under contract to locate property for a buyer and represent the buyer’s interests in a transaction.
Client
A person who has entered into a brokerage relationship with a broker licensee.
Customer
The third party or nonrepresented consumer for whom some level of service is provided.
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| Term | Definition |
|---|---|
Agency | The relationship between a principal and an agent wherein the agent is authorized to represent the principal in certain transactions. |
Agent | One who acts or has the power to act for another. A fiduciary relationship is created under the law of agency when a property owner, as the principal, executes a listing agreement or management contract authorizing a licensed real estate broker to be his or her agent. |
Buyer Representation Agreement | A principal-agent relationship in which the real estate professional acts on behalf of the buyer, usually as an agent, with fiduciary responsibilities to the buyer. |
Buyer’s Agent | A real estate professional who is under contract to locate property for a buyer and represent the buyer’s interests in a transaction. |
Client | A person who has entered into a brokerage relationship with a broker licensee. |
Customer | The third party or nonrepresented consumer for whom some level of service is provided. |
Designated Agency | A process that accommodates an in-house sale in which two different agents are involved. The broker designates one agent to represent the seller and one agent to represent the buyer. |
Designated Agent | A real estate professional authorized by a broker to act as the agent for a specific principal in a particular transaction; also may be called assigned agent or appointed agent. |
Dual Agency | Representing both parties to a transaction. This is unethical unless both parties agree to it, and it is illegal in some states. |
Express Agreement | An oral or written contract in which the parties state the contract’s terms and express their intentions in words. |
Fiduciary | One in whom trust and confidence is placed; a reference to a real estate professional employed under the terms of a listing contract or buyer representation agreement. |
Fiduciary Relationship | A relationship of trust and confidence, as between trustee and beneficiary, attorney and client, or principal and agent. |
Fraud | Deception intended to cause a person to give up property or a lawful right. |
General Agent | One who is authorized by a principal to represent the principal in a specific range of matters. |
Implied Agency | If the actions of the parties imply that they have mutually consented to an agency relationship, an implied agency relationship is formed. |
Implied Agreement | A contract under which the agreement of the parties is demonstrated by their acts and conduct. |
Latent Defect | A hidden structural defect that could not be discovered by ordinary inspection and that threatens a property’s soundness or the safety of its inhabitants. Some states impose on property sellers and real estate professionals a duty to inspect for and disclose latent defects. |
Listing Agreement | A contract between an owner (as principal) and a real estate professional (as representative of the owner) by which the real estate professional is employed to find a buyer for the owner’s real estate on the owner’s terms, for which service the owner agrees to pay a commission or other form of compensation. |
Negligent Misrepresentation | Occurs when the real estate professional should have known that a statement about a material fact was false. |
Nonagent | An intermediary between a buyer and a seller, or a landlord and a tenant, who assists one or both parties with a transaction without representing either. Also known as a facilitator, transaction broker, transaction coordinator, and contract broker. |
Principal | (1) A sum loaned or employed as a fund or an investment, as distinguished from its income or profits. (2) The original amount (as in a loan) of the total due and payable at a certain date. (3) A main party to a transaction—the person for whom an agent works. |
Puffing | Exaggerated or superlative comments or opinions. |
Single Agency | Agency relationship in which the agent represents only one party to a transaction. |
Special Agent | One who is authorized by a principal to perform a single act or transaction; a real estate professional is usually a special agent authorized to find a ready, willing, and able buyer for a particular property, when representing a seller, or a special agent authorized to find a suitable property, when representing a buyer. |
Transaction Broker | Helps both the buyer and the seller with paperwork and formalities in transferring ownership of real property, but who is not an agent of either party. |
Universal Agent | A person empowered to do anything the principal could do personally. |