Fundamentals Of Real Estate

Introduction: Ethics is inevitably linked to professional conduct and to reputation in the real estate industry.
Once a realtor’s ethics are found to be wanting, clients avoid them, and they can be fined, or have their
licenses revoked in some cases. In this assignment you apply some of the ethical practices and legal concepts
necessary for professional conduct and credentials to a scenario.
Scenario: Parker is looking for his first home that he is purchasing directly from the owner. The owner says he
knows a good mortgage broker and provides him with a telephone number. He calls the broker, Kerry, and she
sets up an appointment for the following day to discuss his needs explaining that there will be a fee for services
rendered and are to be paid in advance.
Parker meets the broker the next day at a shopping center coffee shop since the broker’s office is undergoing
complete renovation. Kerry asks him a few questions and then tells him that the best mortgage would be a 6%,
15-year mortgage for the home he wants to purchase. Kerry says she will email him the application by the end
of the day for application to the Mountain Bank. She knows the mortgage banker there and can assure that the
loan will go through easily and speedily. She requests payment upfront, and he gives her a personal check in
the amount of $2,000. On the way home he begins thinking about the meeting and realizes something is not
right. He passes a Savings and Loan in the neighboring community, goes in to ask about the mortgage rate,
and they respond that it is currently 4% for a 15-year mortgage without knowing the particulars of his needs.
Now he decides to investigate.
Based on the Code of Ethics, and your assigned reading address the checklist items:
Analyze the ethical considerations concerning the scenario based on the code of ethics above.
Analyze the legal considerations by doing some research on the Internet.
What process should Parker have used to secure an appropriate mortgage for his prospective Tennessee
Explain what actions he should take.

Sample Solution