Question 47

Automatic renewal clauses may never be used in a buyer-agency agreement.

An automatic renewal clause is not permissible in a buyer-agency agreement, meaning it cannot be included in such contracts under any circumstances.

A) If the property the buyer is seeking is valued at $250,000 or more

This option is incorrect because the value of the property does not determine the permissibility of an automatic renewal clause. Regardless of the property's value, such clauses are not allowed in buyer-agency agreements.

B) Never

This option is correct as it clearly states that automatic renewal clauses cannot be used in buyer-agency agreements. This regulation ensures that buyers are not bound to agreements without their explicit consent at the time of renewal.

C) When the buyer agrees in writing

This option is incorrect because even if a buyer agrees in writing, it does not change the regulatory stance that prohibits automatic renewal clauses in buyer-agency agreements. The law mandates explicit renewal terms to protect buyers.

D) When the property is valued at less than $250,000

This option is also incorrect. Similar to option A, the property value does not influence the legality of automatic renewals, as they are outright prohibited regardless of the property's value.

Conclusion

The correct answer, B, definitively states that automatic renewal clauses may never be used in a buyer-agency agreement, affirming the protection of buyers in these contracts. All other options fail to recognize the legal restrictions in place regarding these clauses, emphasizing the importance of explicit consent for any agreement renewal.