Real Estate Sales Exam Agency and Fiduciary Duties 2

Question 1

A seller's agent learns that the seller is willing to accept $20,000 less than the asking price. What must the agent do with this information?

Accepted Answer

Keep it confidential as it belongs to the seller

Answer

A seller's agent must maintain confidentiality of the seller's minimum acceptable price, as disclosing it would breach the fiduciary duty of confidentiality owed to the seller.

Question 2

What is a 'dual agency' situation in real estate?

Accepted Answer

When one agent or brokerage represents both buyer and seller in the same transaction

Answer

Dual agency occurs when the same agent or brokerage represents both the buyer and seller in a single transaction, creating potential conflicts of interest.

Question 3

Which fiduciary duty requires an agent to place the client's interests above their own personal interests?

Accepted Answer

Loyalty

Answer

The duty of loyalty requires an agent to act solely in the client's best interest and avoid any self-dealing or conflicts of interest.

Question 4

A buyer's agent discovers that the home has foundation issues the seller hasn't mentioned. The agent must:

Accepted Answer

Disclose the defect to the buyer client

Answer

A buyer's agent owes the duty of disclosure to their client and must reveal all material facts that could affect the buyer's decision, including known defects.

Question 5

An agent who follows a client's lawful instructions even when they personally disagree is fulfilling which duty?

Accepted Answer

Obedience

Answer

The duty of obedience requires an agent to follow all lawful instructions given by the principal, even if the agent personally disagrees with them.

Real Estate Sales Exam Practice Test

Real Estate Sales Exam Practice Test

Real Estate Sales Exam Agency and Fiduciary Duties 2