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Responsibility
Responsibilities of the agent to Principal
| Term | Definition |
|---|---|
| Trust,Loyalty,Skill | Must be trustworthy and loyal to Principal. Notify principal of any information. Not give legal advise, avoid puffing. |
| Care and Obedience | Special agent must exercise authority with care. For sale signs,advertising,yard sign must be authorized |
| Accounting for funds | Must account for all funds received, keep separate from personal money, must hold self at highest level of ethical behavior |
| Exclusive right to sell | The broker is employed as the sole agent of the principal and is promised a fee regardless of who procure is |
| Exclusive agency listing | Gives broker sole right to sell property, however, owner reserves right to sell without paying a commission |
| Open Listing | Broker is under contract is not sole agent. Broker must be the one to sell property. |
| Net listing | Broker is permitted to sell or buy for the client at a set price. Illegal in Michigan |
| Protection clause | A clause inserted in a listing aimed at protecting broker if buyer that was found by broker returns to purchase property after expiration date. |
| Agency Relationships with buyers | Agent is hired by buyer to assist in locating property. Created by singing buyer agency contract. Broker becomes agent,salesperson becomes sub-agent |
| Agency Disclosure | Form must be provided to all parties in advance to make them aware of fact |
| Psychology impacts | Murder,drug activity, suicide.. Disclosure is recommended but not required under Michigan Law. |
| Capital Gains | Result from sale of capital assets such as real estate |
| Interest Deduction | IRS allows homeowners to itemize interest deductions on interest payed to finance a principal residence as well as second vacation home. |
| Tax Shelter | A paper loss allowed decreasing yearly profit generated from use of rental or business property. |
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