New York Real Estate for Brokers, 5th e

1. New York Real Estate for Brokers, 5th e By Marcia Darvin Spada Cengage Learning Chapter 2 Real Estate Agency Disclosure

2. Chapter 2 Real Estate Agency Disclosure Chapter 2 Real Estate Agency Disclosure

3. Chapter 2 Key Terms Advance informed consent to dual agency Agent Broker’s agent Buyer’s agent Buyer brokerage Client Customer Disclosure Dual agent/dual agency Estoppel Exclusive-right-to-sell Express agency Fiduciary/fiduciary duties Chapter 2 Real Estate Agency Disclosure

4. Chapter 2 Key Terms (continued) First substantive contact General agent Implied agency Informed consent Open listing Principal Seller’s agent Single agent Special agent Subagent Undisclosed dual agency Undivided loyalty Vicarious liability Chapter 2 Real Estate Agency Disclosure

5. Agency Relationships Chapter 2 Real Estate Agency Disclosure

6. Fiduciary Responsibilities Obedience Loyalty Disclosure of information Confidentiality Accountability Reasonable Care, Skill, and Diligence Chapter 2 Real Estate Agency Disclosure

7. Misrepresentation • A false representation of a material fact • A person making the false representation knew or should have known it to be false • A person acts or does not act based on the misrepresentation • A person who relies on the misrepresentation in acting or not acting Chapter 2 Real Estate Agency Disclosure

8. Duties of the Principal to the Agent • The agent should not be liable if the principal withholds information that causes the agent to make incorrect representations to third parties Chapter 2 Real Estate Agency Disclosure

9. Latent Defects • Hidden or concealed defects that cannot be discovered by ordinary examination or inspection • Buyers may accuse the inspector of failing to notice the problem • A leaky sewer pipe may cause damage to a number of property components Chapter 2 Real Estate Agency Disclosure

10. Types of Compensation Chapter 2 Real Estate Agency Disclosure

11. Creation of Agency Chapter 2 Real Estate Agency Disclosure

12. Agency Alternatives Broker’s agent Buyer Agent Cooperating agent Designated agent Dual Agency Seller agent Single agent Subagent Chapter 2 Real Estate Agency Disclosure

13. Definition of Dual Agent An agent who is acting as a buyer’s agent and a seller’s agent in the same transaction Buyers and sellers may consent to dual agency in advance of it occurring by indicating consent on the agency disclosure form Chapter 2 Real Estate Agency Disclosure

14. Dual Agency Chapter 2 Real Estate Agency Disclosure

15. Designated Agent Definition A salesperson or associate broker, working under the supervision of a real estate broker, who has been assigned to represent a client when a different client is also represented by such real estate broker in the same transaction. Chapter 2 Real Estate Agency Disclosure

16. Designated Sales Associate The designated sales associate and representative broker cannot provide thefiduciary duty of undivided loyalty. Both disclosure forms include a section on“dual agent withdesignated sales associates” Chapter 2 Real Estate Agency Disclosure

17. Buyer Agency Chapter 2 Real Estate Agency Disclosure

18. The Listing Agreement Exclusive-right-to-sell Exclusive agency Open listing Exclusive-right-to-rent Exclusive-right-to represent ( buyer agency) Chapter 2 Real Estate Agency Disclosure

19. The Agency Disclosure Form Sale or rental of 1-4 unit residential properties and condos and coops in any size building Informs consumers of their agency relationship and choices Used at the first substantive contact or for advance informed consent to dual agency Chapter 2 Real Estate Agency Disclosure

20. Two separate agency disclosure forms required one for seller/buyer transactions another for landlord/tenant transactions Chapter 2 Real Estate Agency Disclosure

21. Other Types of Disclosure • Agency • Agricultural districts • Electrical service • Lead-based paint • Mold • Property condition • Radon • Stigmatized Property • UFFI • Utility surcharge • Uncapped gas wells Chapter 2 Real Estate Agency Disclosure

22. Stigmatized Property Disclosure • Occupants who have AIDS or other illnesses not transmitted through occupancy • Properties that were a site of death due to natural causes, accidents, suicide, homicide, crime, and other reasons Chapter 2 Real Estate Agency Disclosure

23. What is a natural gas well? Anatural gas wellis a type of well that is dug or drilled that yields or has yielded natural gas. Three types: Oil wells Natural gas wells Condensate wells Chapter 2 Real Estate Agency Disclosure

24. Dangers of Uncapped Wells Falling in Leakage of gas Combustion/Explosion Chapter 2 Real Estate Agency Disclosure

25. Disclosure Requirements for uncapped natural gas wells Disclosureis made before buyer and seller enter into a contract of sale Sellermust disclose to buyer the existence of any uncapped natural gas wells on the property of which the seller has actual knowledge Cost of capping should not be passed to new property owner Chapter 2 Real Estate Agency Disclosure

26. The Well Head Mounted at the opening of the well to regulate and monitor the extraction of hydrocarbons from underground Prevents leaking of oil or natural gas out of the well Prevents blowouts due to high pressure formations Chapter 2 Real Estate Agency Disclosure