Agency
In Tennessee, a licensee who also has a personal financial interest in a transaction (for example, part-owner of the company buying the listing) must:
AWithdraw from the transaction automatically
BDisclose the personal financial interest to all parties✓ Correct
CAct only as a transaction broker in that case
DObtain TREC's approval before proceeding
Explanation
Tennessee license law requires licensees to disclose any personal financial interest they have in a transaction. This is part of the fiduciary duty of disclosure and ensures all parties can make informed decisions.
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Key Terms to Know
Fiduciary Duty
The highest legal duty an agent owes to a principal — requiring the agent to act in the principal's best interest above all others.
Buyer's AgentA real estate licensee who represents the buyer's interests in a transaction, owing fiduciary duties to the buyer.
Seller's Agent (Listing Agent)A real estate licensee who represents the seller's interests, markets the property, and owes fiduciary duties to the seller.
AgencyA legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.
State-Specific Concepts
TREC RegulationLicense Law
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