Contracts
What is a 'net listing' in North Dakota, and what is the ethical concern with it?
AA listing with no commission; no ethical concern
BA listing where the broker's commission is the amount above a seller's net price; it creates a conflict of interest between broker and client✓ Correct
CA listing limited to commercial properties; no ethical concern
DA listing restricted to MLS members; minimal ethical concern
Explanation
In a net listing, the broker keeps everything above the seller's specified net price as commission. This creates a conflict of interest because the broker benefits from a higher price, potentially to the seller's detriment.
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Key Terms to Know
Lien
A financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Option ContractA contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
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.
Earnest MoneyA deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
Math Concepts
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