Maine Real Estate License Practice Exam

What is a general characteristic of Disclosed Dual Agency?

1. Always considered illegal

2. Encourages competition between buyers

3. Can be effective without consent

4. Limits agent's services for the client

The correct answer is: Limits agent's services for the client

Disclosed Dual Agency refers to a situation where a real estate agent represents both the buyer and the seller in the same transaction, with the knowledge and consent of both parties. A key characteristic of Disclosed Dual Agency is that it inherently limits the agent's services to each client. This is because the agent must navigate the potential conflict of interest that arises from representing both sides. In such a scenario, the agent cannot fully advocate for either party’s best interests because doing so for one would inherently disadvantage the other. As a result, their ability to provide comprehensive advice, negotiate fiercely on behalf of one party, or disclose certain information is restricted. The agent is required to maintain neutrality and fair dealing, which naturally curtails the scope of services offered to both the buyer and the seller. In this context, the other choices do not accurately reflect the nature of Disclosed Dual Agency. It is not always considered illegal; in many jurisdictions, it's a lawful practice as long as both parties are informed. It does not encourage competition between buyers because it involves a single transaction with both parties involved. Additionally, effective representation cannot occur without the consent of both parties, meaning that the services cannot be rendered without agreement. Therefore, the limitation of the agent's services stands as a