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GLOSSARY

Canadian Financial, Real Estate and Mortgage Glossary

How often this word is used
 
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50% - Moderately

Mis-selling


Synonyms:misleading, misrepresenting, undisclosed information
Filed Under: financial-banking, insurance, investments, legal-contracts, mortgages, real-estate
Tags: banking, contract, insurance, investment, legal, mortgage, realty
 

Definition of mis-selling

mis-selling
1. The act of misrepresenting a product or service and misleading a perspective client, investor, or buyer in order to make a sale. An unethical salesperson mis-selling a product may leave out certain caveats or information to make a product sound better or more relevant to the buyer than it truthfully is. For example, a computer salesperson may tell a customer to buy a $2,000 computer when a $500 computer will do the exact same tasks at a quarter the cost, or an insurance agent may try to persuade an individual without dependents to buy a life insurance policy they do not need.

Related Terms and Acronyms:

  • agent (agt)   A person who acts on behalf of another. In real estate, an agent is a person who conducts transactions on behalf of sellers and sometimes buyers.
  • clean sheeting   A type of insurance fraud where an individual deliberately fails to disclose a pre-existing condition in order to receive coverage, sometimes with the help of an insurance broker.
  • concealment   The act of lying or omitting information when applying for insurance coverage.
  • disclosure   A statement listing potential defects to a property, such as the possible existence of lead paint or radon.
  • fiduciary duty   A requirement that someone in a position of trust, such as a banker, real-estate agent, or title agent, must act in good faith and trust on behalf of a client.
  • insurance fraud   An illegal attempt by an individual or entity to receive insurance benefits that they would otherwise not be entitled to or for an insurance company to deny a legitimate insurance claim.
  • property report   A legal disclosure that developers of timeshare properties are required to give to prospective buyers.
  • statute of frauds (SOF)   A law which provides that certain contracts must be in writing to be enforceable at law. This includes real estate contracts.
  • unfair claims practice   The act of an insurance company avoiding or reducing valid insurance claims.

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