What is a key benefit for buyers under the new representation rules?
Correct Answer
B) Clear understanding of agent services and costs before touring homes
The benefit is information before commitment: what the agent will do and what it costs, settled in writing before the first showing rather than raised at closing. Other choices: representation at no cost to the buyer in any transaction they choose was never promised, and the changes make the cost explicit precisely because it was never free; guaranteed lower home prices are outside what any settlement about commissions could deliver; and automatic seller-paid commissions are the arrangement that ended. Source: NAR settlement practice changes, effective 17 August 2024.
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Related Topics & Key Terms
Related Topics:
Key Terms:
Related Concepts
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.
In real estate, a client is someone to whom the agent owes fiduciary duties through an agency relationship, while a customer is a third party to whom the agent owes only honesty and fair dealing.
An arrangement where a brokerage assigns separate agents within the firm to represent the buyer and seller in the same transaction, allowing each client to have dedicated representation.
More General Principles Of Agency Questions
A listing agreement creates an agency relationship between:
A property management agreement between an owner and a property manager typically specifies which of the following?
What is 'designated agency' in the context of a real estate brokerage?
A real estate team receives a referral from a past client. The team leader assigns the referral to a team member. The team member shows the buyer several properties. Who is the buyer's agent?
A buyer's agent compensation can be structured as:
- → A commercial tenant is negotiating a five-year lease for retail space. The tenant hires a tenant representative broker to negotiate lease terms on the tenant's behalf. What agency relationship exists between the tenant and the tenant representative?
- → A property manager signs a lease on behalf of the property owner. The management agreement authorizes the manager to execute leases for terms up to one year. The manager signs a three-year lease with a commercial tenant. What is the likely consequence?
- → A property manager discovers that a rental unit has a significant mold problem. The manager repairs the visible mold but does not inform the property owner about the extent of the damage or the potential liability. Has the property manager violated any agency duty?
- → A listing agent tells prospective buyers that the home sits on 'the finest street in the whole county' and is 'a once-in-a-lifetime opportunity.' These statements are best characterized as:
- → Real estate commissions are typically based on:
- → Under the new rules, how can a buyer's agent be compensated?
- → Casey Patel is hired only to find a ready, willing, and able buyer for Morgan Flores's duplex and has no authority over Morgan's other affairs. Classified by the scope of authority granted, what type of agent is Casey?
- → Casey Patel asks a licensee to unlock homes and write up an offer but refuses to sign any representation agreement. What is Casey's usual status relative to that brokerage?
- → All of the following must generally be disclosed to prospective buyers EXCEPT
- → Grace Rivera gives Natalie Perry an earnest money check, and Natalie Perry promptly deposits it in the proper trust account and keeps accurate records. Which fiduciary duty is this?
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