Humber/Ontario Real Estate Course 4 Exam Practice

When dealing with a 'For Sale by Owner' (FSBO), what should a salesperson ensure before proceeding?

1. A FSBO would not agree to a brokerage showing the property and bringing an offer.

2. A salesperson should make certain, when contacting a FSBO, to quickly establish that the individual has not signed an exclusive seller representation agreement.

3. If the property is being shown to your buyer client, it's acceptable to rely on seller-provided property details.

4. A customer service agreement is irrelevant and cannot be used in the case of a For Sale By Owner.

5. A FSBO generally does not require any intervention from real estate salespersons.

6. A salesperson working with a buyer client should avoid FSBO properties.

The correct answer is: A salesperson should make certain, when contacting a FSBO, to quickly establish that the individual has not signed an exclusive seller representation agreement.

When handling a 'For Sale by Owner' (FSBO) situation, it's crucial for a salesperson to ensure that the FSBO seller has not entered into an exclusive seller representation agreement with another brokerage. This is important because such an agreement legally binds the seller to work exclusively with a specific brokerage, meaning that any assistance or representation provided by another realtor could lead to legal complications for both the seller and the salesperson. The salesperson must verify the seller's status to avoid the risk of representing a buyer on a property that the owner is obligated to sell through another agent. Understanding this is essential in maintaining ethical standards in real estate practice and ensuring that the interests of all parties involved are respected. This due diligence helps in protecting the salesperson from potential claims of interference or breach of contract, thereby safeguarding their professional reputation and legal standing within the industry.