Question

-In a real estate transaction, a broker had a written representation agreement with the buyer but was paid 6 percent of the selling price at the closing by the seller. Under these facts, whose agent was this broker?

a. The broker was the seller's agent.
b. The broker was the buyer's agent.
c. The broker is a dual agent.
d. The broker has violated New York's real Estate license laws and may have his or her License suspended or revoked.

Answer 1

In the described real estate transaction, the broker is the buyer's agent because of the written representation agreement with the buyer. While the seller paid the broker's commission, this doesn't change the fact that the broker is serving as the buyer's agent. There's no evidence of license law violation or dual agency.

Step-by-step explanation:

In the scenario where a real estate broker has a written representation agreement with the buyer and is paid by the seller, the broker is acting as the buyer's agent. This is because the representation agreement establishes a fiduciary relationship with the buyer, and the payment by the seller at closing does not necessarily alter that relationship. It is common in real estate transactions for the seller to pay the commission, that does not change the broker's role as the buyer's agent.

In this case, the broker would not be considered a dual agent because there is no indication that the broker also had an agreement with the seller that would require fiduciary duties to both parties. It's also unlikely that the broker has violated New York's Real Estate license laws solely on the basis of being compensated by the seller, as this is a standard industry practice. However, it's essential for brokers to disclose how they are compensated and by whom, and to ensure that they adhere to all appropriate laws and ethical standards.