PSI Virginia Real Estate Practice Exam

In a nonexclusive right-to-represent contract, when is the broker entitled to compensation?

1. If the buyer chooses a house proposed by the broker

2. Whenever the broker provides services, regardless of outcome

3. If the buyer retains more than one broker

4. If the buyer decides not to buy any property

The correct answer is: If the buyer chooses a house proposed by the broker

In a nonexclusive right-to-represent contract, the broker is entitled to compensation if the buyer chooses a house proposed by the broker. This type of agreement allows the buyer to work with multiple brokers simultaneously, but still establishes a condition for the broker's compensation. When the broker presents options to the buyer, should the buyer select a property from those proposals, the broker earns their commission for facilitating the transaction. The other options do not align with the conditions set forth in this type of agreement. For instance, compensation is not guaranteed simply for providing services regardless of the outcome because the broker's payment hinges on the buyer's successful purchase of a property they have shown. Additionally, retaining more than one broker does not entitle any brokers to compensation until a transaction occurs; simply having multiple brokers engaged does not affect the situation unless one of them successfully closes a deal. Lastly, if the buyer decides not to pursue any property, the broker would not receive compensation since the sale did not occur. Thus, option A correctly reflects the compensation structure in a nonexclusive right-to-represent contract.