Broker Martinez in San Diego tells a seller, "I always charge a 6% commission — it's the standard rate in this area." Under California law, what is problematic about this statement?
Correct Answer
C) It implies that a standard commission rate exists, when every rate is negotiable
There is no standard commission rate, and describing one as standard is how price fixing sounds when it reaches a seller. Commission is negotiable in every transaction, which is what the broker's sentence quietly denies. Other choices: California sets no commission rate; MLS membership has no bearing on it; and putting the rate in writing documents the term without curing the claim that it is the going rate.
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Related Topics & Key Terms
Key Terms:
Related Concepts
An agency relationship where the agent agrees to act on behalf of the principal without receiving compensation.
An agency relationship created by the conduct or actions of the parties rather than by a written or oral agreement.
The legal obligation to reveal information that could affect a party's decision to enter into or the terms of a real estate transaction.
More Laws Of Agency Fiduciary Duties Questions
Under California law, the agency disclosure requirements apply to which types of property?
Under California law, when must a buyer's agent give the agency disclosure form to the buyer?
A broker who fails to promptly disclose their dual agency status is subject to:
A broker’s fiduciary obligation to protect a seller’s confidential information continues:
A broker has an exclusive agency listing on a property. If the owner sells the property, the broker is entitled to:
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