Tennessee Realtor State Practice Exam

What is the legal and binding Tennessee contract that outlines the duties for both the property manager and property owner?

1. Management service agreement

2. Property management agreement

3. Leasing agreement

4. Tenant agreement

The correct answer is: Property management agreement

The property management agreement is the legal and binding contract that clearly delineates the responsibilities and duties of both the property manager and the property owner in Tennessee. This document serves as a foundational guideline for the relationship between the two parties, establishing clear terms regarding management fees, maintenance obligations, tenant screening procedures, and more. It ensures that both the property owner and the manager have a mutual understanding of their roles and expectations, thereby minimizing potential disputes. In contrast, a management service agreement typically refers to broader terms that may not specifically focus on property management. A leasing agreement primarily outlines the terms between a landlord and tenant, including rental conditions, tenant rights, and property use. A tenant agreement, similarly, deals with the legal arrangements between a property owner or landlord and the tenants, addressing issues such as rent, property usage, and responsibilities. Thus, while these other agreements serve important functions within real estate management, they do not fulfill the specific role of establishing the responsibilities between property owners and managers in the same focused manner as the property management agreement.