What Is Dual Agency?
When a real estate agent represents both the buyer and seller in a real estate transaction, the agent is considered a dual agent. Since the broker is representing both sides, the broker is unable to maintain all his duties to both parties. Because of the broker’s potential conflict of interest, the broker must obtain both parties consent to the dual agency. What Does the Consent Involve?
When a broker represents both sides of a transaction, the broker must ask for both parties’ consent in writing. When the parties consent to dual agency, they are accepting limitations to a traditional real estate broker / client relationship. These limitations include that the agent will deal impartially with both parties. How Does a Dual Agent Avoid Improper Disclosure?
When the parties consent to dual agency, the broker will have a duty to disclose information to both parties. For example, a broker must disclose known defects about the property. However, there are exceptions to the disclosure policy: - The agent will not disclose that the:
- Buyer is willing to pay a higher price
- Seller is willing to sell for a lower price
- Buyer or seller is willing to accept different terms
- The agent will not disclose without prior authorization:
- The motivation of the buyer or seller
- Personal information about the buyer or seller
Do I Need a Lawyer if I Work with a Dual Agency Broker?
Because of the risks associated with dual agency, you are strongly encouraged to meet with an experienced real estate attorney. A real estate lawyer can determine if dual agency is appropriate for you, and can review documents and contracts before you sign them. If you believe an agent acted improperly in dual agency, a real estate attorney can explain your rights and remedies. |
