OH RE Broker key terms

A brokerage practice in which the firm assigns one licensee to represent the buyer and another to represent the seller in the same transaction, so both clients receive full fiduciary duties from their own agent.

A situation where one licensee represents both buyer and seller in the same transaction. Ohio permits it only with the informed written consent of both parties, and it limits the agent's ability to advocate for either side.

The heightened legal obligations an agent owes a client: loyalty, obedience, disclosure, confidentiality, accounting, and reasonable care and diligence. These duties survive the transaction for confidentiality purposes in Ohio.

The written statement Ohio licensees must give consumers at the first substantive contact explaining agency relationships, who the licensee represents, and how compensation is shared. It must be signed before a purchase agreement is executed.

The uninterrupted series of efforts by a licensee that results in a ready, willing, and able buyer or seller. It determines who earns a commission when brokers dispute entitlement, often through arbitration.

A written contract between a brokerage and a licensee establishing that the licensee is not an employee for tax purposes. The brokerage must still supervise activities and withhold requirements differ from employee status.

The agreed division of a gross commission between the brokerage and the licensee, and sometimes a cooperating broker. The split is set by contract and must be disclosed in the independent contractor agreement.

The broker's duty to oversee licensee activities, review documents, and ensure compliance with Ohio law and rules. Failure to supervise can result in discipline against the broker's license.

A separate bank account where a broker deposits client funds such as earnest money and security deposits. Ohio rules require proper records, no commingling with operating funds, and reconciliation.

A good-faith deposit from the buyer showing intent to perform under the purchase contract. It is typically held in trust and applied to the purchase price or refunded per contract terms.

A neutral third party holds funds and documents until contractual conditions are met. In Ohio, escrow agents must follow specific disbursement rules and maintain accurate records.

A contract condition that must be satisfied for the transaction to proceed, such as financing, inspection, or appraisal. If unmet within the stated period, the contract may be terminated or renegotiated.

A negotiated timeframe during which the buyer may inspect the property, review records, and investigate conditions before committing to close. The contract defines remedies if the buyer withdraws.

Ohio's residential property disclosure form requires sellers to disclose known material defects to buyers. Licensees must ensure the form is provided and should not advise sellers to conceal defects.

Information that could influence a reasonable buyer's or seller's decision, such as defects, zoning issues, or pending litigation. Licensees must disclose material facts they know and cannot conceal them.

The doctrine that buyers take property as-is and bear responsibility for inspecting it. Ohio's disclosure statute and fraud rules significantly limit its application in residential transactions today.

Federal and Ohio laws prohibiting discrimination in housing based on protected classes such as race, color, religion, sex, national origin, familial status, and disability. Violations carry civil and license penalties.

Directing buyers toward or away from neighborhoods based on protected characteristics. It is illegal even when motivated by a desire to match clients with similar demographics.

Inducing panic selling by suggesting that members of a protected class are moving into a neighborhood. It is a prohibited practice under fair housing law and a license violation.

Refusing or varying terms of services, such as lending or insurance, in certain neighborhoods based on protected characteristics. It violates fair housing and fair lending laws.

The Real Estate Settlement Procedures Act governs federally related mortgage transactions, requiring disclosures, limiting certain fees, and prohibiting kickbacks for referrals of settlement services.

A relationship where a licensee refers clients to a settlement service provider in which they have an ownership interest. RESPA requires written disclosure of the arrangement and does not require use of the provider.

An unearned fee or thing of value given in exchange for referring settlement service business. Prohibited by RESPA and Ohio law, with exceptions for legitimate services actually performed.

An Ohio spousal interest in real property that can affect conveyances and title. A spouse may need to release dower rights for a valid sale, so brokers should confirm marital status and title requirements.

A written instrument that transfers an interest in real property. Common types include general warranty, special warranty, and quitclaim deeds, each carrying different title warranties.

Coverage protecting buyers and lenders against defects in title, such as liens or recording errors. Ohio rates are filed with the state, and buyers may shop for coverage.

A written contract between a seller and brokerage authorizing the firm to market the property. Ohio requires it to state the term, compensation, and whether it is exclusive.

A listing arrangement where the broker earns a commission regardless of who procures the buyer, including the seller. It provides the strongest broker protection and must be in writing.

A non-exclusive listing where the seller may use multiple brokers and pays only the broker who procures the buyer. It offers the least protection to the broker.

A written contract establishing a brokerage's representation of a buyer, including duties, term, and compensation. Ohio requires written agency agreements for buyer representation.

An analysis of recent comparable sales, active listings, and market conditions used to estimate a property's likely sale price. It is not a licensed appraisal.

A licensed professional's opinion of value developed under uniform standards. Ohio requires state certification for appraisers, and brokers may not perform appraisals without credentials.

Dollar or percentage changes applied to comparable sales to account for differences in features, location, condition, and time. Adjustments are made to the comparable, not the subject property.

A valuation method estimating value by comparing the subject property to similar recent sales and adjusting for differences. It is most reliable for residential properties with abundant comparable data.

The reasonably probable use that is legally permissible, physically possible, financially feasible, and maximally productive. It guides valuation and development analysis.

A valuation method converting expected future income into present value, often using capitalization rates. It is most useful for income-producing properties like apartments and commercial buildings.

The ratio of a property's net operating income to its value or purchase price. It reflects expected return and risk, and is used to estimate value from income.

Effective gross income minus operating expenses, excluding debt service and income taxes. It is a key input for capitalization and income-based valuation.

The loan amount divided by the property's value or purchase price. Lenders use it to assess risk, and higher ratios often require mortgage insurance or stricter terms.

The gradual repayment of a loan through scheduled payments of principal and interest. A loan's amortization schedule shows how the balance declines over time.