Iowa Real Estate Practice Exam

In the situation described, what must the buyer's agent do before approaching the seller regarding the buyer's commission?

1. Negotiate a lower price with the seller

2. Call the listing agent for written permission

3. Obtain consent from the buyer

4. Submit the offer to the seller directly

The correct answer is: Call the listing agent for written permission

The correct answer is focused on the necessity of securing written permission from the listing agent before a buyer's agent can approach the seller regarding the buyer's commission. In real estate transactions, clear communication and consent are essential, particularly when it comes to commission structures. The seller's agent typically has a contractual obligation to represent the seller's interests, and any discussions around commission must align with those established agreements. By calling the listing agent for written permission, the buyer’s agent is ensuring that they are adhering to ethical standards and legal requirements within the industry. This step protects both the buyer and the seller's interests and prevents any potential conflicts or misunderstandings regarding compensation. Obtaining consent from the buyer may seem essential, but it's the interaction with the listing agent that's critical in this context since the buyer's agent is working within a framework established by the listing agreement. Negotiating a lower price with the seller or submitting an offer directly bypasses the necessary communication protocols and doesn't address the specifics of commission arrangements, making them less relevant in this scenario.