Agency disclosure ensures that all parties understand the nature of the representation they are receiving. Most states require written disclosure forms that explain the different types of agency relationships. Failure to disclose can result in disciplinary action and legal liability.
At the first meeting with a potential buyer, the agent provides a written agency disclosure form explaining buyer agency, seller agency, dual agency, and transaction brokerage. The buyer signs acknowledging they received and understood the disclosure.
Agency disclosure must happen at FIRST SUBSTANTIVE CONTACT — not just casual conversation. Know when substantive contact occurs: discussing specific properties, financial qualifications, or motivation. Providing general market info or open house flyers is NOT substantive.
Related Terms
Related Concepts
A legal relationship in which one person (the agent) is authorized to act on behalf of another person (the principal) in business transactions with third parties.
The highest legal obligation of trust and confidence owed by an agent to their principal, requiring the agent to act solely in the principal's best interest.
A situation where a single agent or brokerage represents both the buyer and the seller in the same real estate transaction.
An arrangement where a brokerage assigns separate agents within the firm to represent the buyer and seller in the same transaction, allowing each client to have dedicated representation.
A non-agency relationship where the broker facilitates a real estate transaction without representing either party, owing limited duties of honesty, fairness, and competence to both.
Frequently Asked Questions
Study This in Your State
Agency Disclosure may have state-specific rules. Choose your state to study Agency with localized content: