Idaho Real Estate Practice Exam

What implication does a limited disclosed dual agency have for the involved parties?

1. The salesperson may prioritize one party over another

2. Both parties must sign the same listing agreement

3. Both parties need to be informed and consent to the arrangement

4. Each party can negotiate independently of the broker

The correct answer is: Both parties need to be informed and consent to the arrangement

A limited disclosed dual agency refers to a situation in real estate where a single broker represents both the buyer and the seller in a transaction. The key implication of this arrangement is that both parties must be informed about the dual agency status and provide their consent to it. This ensures transparency in the transaction, allowing both the buyer and the seller to understand that the broker is representing their interests simultaneously. In this context, informing both parties is crucial because it addresses potential conflicts of interest and helps maintain trust in the broker's integrity. Consent is also necessary as it gives the parties a clear understanding of their rights and roles and allows them to make informed decisions regarding the representation they are receiving. The other options do not accurately capture the essence of limited disclosed dual agency. For example, the prioritization of one party over another would undermine the broker's role as a neutral facilitator and could lead to ethical issues. Signing the same listing agreement is unnecessary; each party could have different agreements with the broker based on their interests. Negotiating independently of the broker may not be feasible in a dual agency scenario, as the broker is responsible for facilitating discussions between both parties.