Exam 6: The Search for Real Estate

Jeff, a real estate agent, sells a home to a black couple in a predominately white community.After the sale, he goes to the neighbors and encourages them to sell their homes.He tells them that if they do not, their home values will go down substantially because of the area's imminent transition into a black neighborhood.Jeff is engaged in what illegal practice?

Kelsey, a seller, signs two open listing agreements with two brokers, Ryan and Nicole.Ryan is the first to find Marissa a potential buyer, who agrees to buy the property if a suitable closing date can be worked out.Without Ryan's knowledge, Nicole later strikes a deal with Marissa to close earlier and persuades her to sign the contract to buy Kelsey's home.In this situation the commission would go to:

Generally, a broker has implied authority to both advertise the house and to accept money from the buyer.

In most cases, an unlicensed real estate broker may collect a commission earned on the sale of real estate, regardless of who makes the sale, under an "exclusive right to sell" agreement.

Only licensed real estate brokers can advertise homes on the World Wide Web since this information can be accessed by potential buyers in interstate commerce.

The 1968 Fair Housing Act prohibits discrimination in the following situations:

A seller of real estate may cancel at any time a listing agreement that is to be in effect for a specified time, if the broker has given consideration.

In some states a person may broker a sale of property not as an agent with fiduciary duties, but as a transactional broker who simply "assists" a particularly party and is not a fiduciary to that party.

Traditionally, the broker whose client bought property listed by another broker, was considered a subagent of the seller, not the agent of the buyer

The Federal Trade Commission has ruled that the National Association of Realtors® is violating antitrust law when it excludes brokers who operate virtual office websites from giving their clients property listings.

Which of the following agents can be held personally liable to third parties for contracts negotiated on behalf of an undisclosed principal?

A listing agreement providing a real estate agent with an exclusive right to sell property also contains a "no deal, no commission clause." If a potential purchaser is unable to obtain financing to complete the purchase after signing a contract:

Competing brokers A and B meet for lunch and decide to set commissions at 6 percent for a two month period.This activity would be illegal per se under antitrust law.

In most states, licensed real estate brokers and salespersons must also be members of the National Association of Realtors.

Under a buyer-broker arrangement, a buyer may not leave her agent for another buyer agent if she signs an exclusive agency contract without being liable for a commission if the broker finds her a property to buy.

Under the U.S Supreme Court's ruling in Meyer v.Holley, brokers are still strictly and personally liable when their agents violate the Fair Housing Act of 1968.

Language such as "a commission is to be paid to the broker whether the purchaser is secured by the broker or by any person other than the seller" creates an "exclusive right to sell" listing agreement.

Broker A has a listing agreement with the seller.Broker B has found a buyer for the property, but he is not the buyer's broker.Assuming that both brokers are subject to an MLS agreement:

As a general rule, an agent will be held personally liable for contracts negotiated on behalf of a principal.

Under the traditional rule, a broker earns a commission under a listing agreement whenever he procures a buyer who is "ready, willing and able" to purchase the real estate, even if the seller refuses to sign a contract with the buyer.