Unit 8

Antitrust laws

Laws designed to preserve the free enterprise of the open marketplace by making illegal certain private conspiracies and combinations formed to minimize competition.

Buyer agency agreement

A principal-agent relationship in which the broker is the agent for the buyer, with fiduciary responsibilities to the buyer. The broker represents the buyer under the law of agency.

Co-brokered sale

A real estate transaction involving two or more brokerage firms, one firm representing the seller and the other representing the buyer.

Co-listing

Two brokerage firms team up to sell a property, usually to create more effective marketing for the listing client.

Comparative market analysis (CMA)

A comparison of the prices of recently sold homes that are similar to a listing seller's home in terms of location, style, and amenities. An estimate of market value, aka broker price opinion.

Cooperative listing service (CLS)

Another term for MLS.

Employment contract

A document evidencing formal employment between employer and employee or between principal and agent. In real estate, this is generally a listing agreement, a buyer agency agreement or management agreement.

Exclusive agency listing

A listing contract under which the owner appoints a real estate broker as the exclusive agent for a designated period of time to sell the property, on the owner's stated terms, for a commission. The owner reserves the right to sell without paying anyone a commission if the owner sells to a prospect who has not been introduced or claimed by the broker.

Exclusive right to sell listing

A listing contract under which the owner appoints a real estate broker as the exclusive agent for a designated period of time to sell the property on the owner's stated terms and agrees to pay the broker a commission when the property is sold, regardless of who sells the property.

Extender clause

A carry-over or protection clause in a listing contract that says the listing broker is entitled to commission for a time period after expiration of the listing term if the property is transferred to a prospect that the broker introduced to the property during the listing term; override clause. This clause is void if the property is listed with another broker.

Fee for service agreement

Arrangement where consumer asks licensee to perform specific real estate services for a set fee; unbundling of services; limited service firms.

Frontage

The length of property along the street or waterfront.

In house sale

A real estate transaction where the listing firm actually produces the buyer for their listing, as opposed to a co-brokered or cross sale that involves two firms.

Limited services agreement

Also known as a fee-for-services agreement, a listing agreement that offers a menu of services and fees for separate broker activities that the client desires (unbundling of services)

Listing agreement

An employment contract between a property owner (as principal) and a real estate firm/broker (as agent) by which the broker is employed to find a ready, willing and able buyer for the owner's real estate on the owner's terms, for which service the owner agrees to pay a commission.

Mineral and Oil and Gas Rights Mandatory Disclosure Statement

Since 2015, a separate North Carolina disclosure form that must be completed by most sellers of residential dwellings reagarding the status of mineral, oil, and gas rights.

Multiple listing service (MLS)

A marketing organization composed of member brokers who agree to share their listing agreements with one another in the hope of procuring ready, willing, and able buyers for their properties more quickly than they could on their own.

National Do Not Call Registry

A national registry, managed by the Federal Trade Commission, that lists the phone numbers of consumers who prefer to limit the telemarketing calls they receive.

Net listing

A listing based on the net price the seller will receive if the property is sold. Under a net listing, the broker can offer the property for sale at the highest price obtainable to increase the commission. This type of listing is illegal in many states, is legal but not encourgaged in North Carolina.

North Carolina Residential Property Disclosure Act

The state law that requires sellers to provide a prescribed property disclosure statement to any prospective buyer prior to presentation of first offer on the property. Exemptions include new construction, foreclosed properties and lease purchases but not for sale by owner transactions.

Open listing

A listing agreement under which the broker's commission is contingent on the broker personally producing a ready, willing, and able buyer before the property is sold by the seller or another broker.

Override clause

Also called extender, or carry-over, clause. It provides for seller to pay the full commission to broker for any sale to registered prospects within the specified period after the termination of the contract.

Price fixing

The practice of colluding with other firms to control prices. This is an illegal as provided by antitrust laws.

Procuring cause

The effort that began a chain of events that brings about the desired result. Under an open listing, the broker who is the procuring cause of the sale receives the commission.

Protection agreement

an agreement between an unlisted property owner and a broker to secure payment for the broker if the property is sold to the particular buyer named in the agreement; it does not create a general listing, and may not create agency at all - only compensation for a buyer's agent. Sometimes called a "one-shot" listing.

Puffing

Exaggerated or superlative comments or opinions.

Ready, willing, and able buyer

One who is prepared to buy the property on the seller's ‎terms and is ready to take positive steps to consummate the transaction; one of the agent's requirements for entitlement to commission.

Retainer fee

A small fee paid by the client upon creation of a buyer agency relationship as an advance partial compensation for services; it may be non-refundable or applied to final compensation due depending on the agency agreement.

Success fee

Compensation that is due and payable upon the creation of a valid sales contract for property located by the buyer's agent.