Agency
When a seller lists a property 'net' — meaning they want a specific amount and the agent keeps everything above that — this arrangement is:
ALegal and encouraged in California
BLegal only with written disclosure
CIllegal in California✓ Correct
DLegal only for commercial properties
Explanation
Net listings are illegal in California. They create a conflict of interest because the agent profits more by obtaining a higher price, which can incentivize the agent to mislead the seller about the property's true market value.
Related California Agency Questions
- The duty of 'accounting' in a fiduciary relationship requires an agent to:
- What is 'designated agency'?
- An agent who acts beyond the scope of their authority may be liable for:
- What is 'ratification' in agency law?
- When does an agency relationship typically terminate?
- In California, a 'designated agency' arrangement allows a broker to:
- An agent who represents both the buyer and the seller in the same transaction is known as a:
- Under California law, a real estate broker who manages property for clients must maintain a separate trust account for client funds. Mixing client funds with the broker's personal funds is called:
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