Agency
In NJ, a 'net listing' creates a conflict of interest because the broker's compensation is tied to:
AA flat fee regardless of price
BThe amount by which the sale price exceeds the seller's net, incentivizing the broker to maximize price rather than serve the seller's interest in a fair transaction✓ Correct
CThe time spent marketing the property
DCommission split with the buyer's agent
Explanation
Net listings create a direct financial conflict: the broker profits from every dollar above the seller's net, which could incentivize the broker to withhold lower offers or push for inflated prices rather than acting in the seller's genuine best interest.
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Key Terms to Know
Buyer's Agent
A real estate licensee who represents the buyer's interests in a transaction, owing fiduciary duties to the buyer.
Fiduciary DutyThe highest legal duty an agent owes to a principal — requiring the agent to act in the principal's best interest above all others.
AgencyA legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.
Dual AgencyA situation where a single real estate agent or brokerage represents both the buyer and the seller in the same transaction.
Math Concepts
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