California Real Estate Practice Exam

In the real estate business, the buyer is commonly referred to as a(n):

1. Fiduciary.

2. Attorney-in-fact.

3. Customer.

4. Client.

The correct answer is: Fiduciary.

In the context of real estate transactions, the term commonly used to refer to the buyer is "client." This terminology highlights the formal relationship established between the buyer and their real estate agent or broker. A client is someone who has engaged the services of a professional and often has a contract or agreement in place, which includes an obligation for the agent to act in the best interests of the buyer. This relationship encompasses fiduciary duties, meaning the agent must prioritize the client's interests, maintain confidentiality, and provide loyalty and full disclosure. While a fiduciary is a term that describes the duty owed by the agent to the client, it does not specifically designate the buyer themselves. In contrast, the other terms mentioned do not typically represent the buyer in a real estate transaction. An attorney-in-fact refers to someone authorized to act on behalf of another in legal matters without needing to be a licensed attorney. A customer, while related to a transaction, typically refers to someone who engages with a service but does not have an official relationship with an agent or broker. Therefore, understanding the distinctions in these terms is crucial, and recognizing the buyer as a client emphasizes the formal relationship and responsibilities defined within real estate practices.