Agent Taylor represents buyer Henderson in an Iowa residential transaction. As Henderson's buyer's agent, Taylor owes Henderson several fiduciary duties. Which of the following is NOT a fiduciary duty that Taylor owes to Henderson under Iowa law?
Correct Answer
A) Solvency — guaranteeing that Henderson will be able to secure mortgage financing
Solvency — guaranteeing that a buyer will secure mortgage financing — is NOT a fiduciary duty owed by a buyer's agent. Iowa law, consistent with general agency principles, recognizes the fiduciary duties of loyalty, confidentiality, disclosure, obedience, reasonable care, and accounting. No agent can guarantee a buyer's financial qualification or lender approval. Guaranteeing solvency is not a recognized duty and is beyond the scope of any real estate agent's obligations under Iowa Code Chapter 543B.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A legal relationship in which one person (the agent) is authorized to act on behalf of another person (the principal) in business transactions with third parties.
The legal ending of an agency relationship, which can occur through completion, expiration, mutual agreement, breach, death, incapacity, or bankruptcy of either party.
The fiduciary obligation to protect a client's private information and not disclose it to third parties without permission, surviving even after the agency relationship ends.
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