A New Jersey licensed broker places a newspaper advertisement for a residential property that reads: 'Owner will sell — 4BR colonial in Princeton — $650,000 — Call 609-555-0200.' The broker is acting as the listing agent for the seller. The ad does not indicate that a broker is involved. Under New Jersey law, this advertisement is problematic primarily because:
Correct Answer
A) The advertisement implies the seller is selling without an agent, which constitutes misrepresentation
Under New Jersey advertising regulations and the Consumer Fraud Act (N.J.S.A. 56:8-1 et seq.), an advertisement that implies a property is being sold by the owner directly — when in fact a licensed broker is representing the seller — constitutes misrepresentation. The phrase 'Owner will sell' misleads the public into believing no broker is involved, which violates the prohibition on deceptive advertising and the requirement that broker involvement be disclosed.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Florida brokers are required to maintain transaction records and escrow records for a minimum of five years.
A tie-in arrangement is an illegal antitrust practice in which a seller conditions the purchase of one product or service on the buyer's agreement to purchase a separate product or service.
A trust account, also called an escrow account, is a separate bank account maintained by a broker to hold funds belonging to others, such as earnest money deposits, security deposits, or other client funds.
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