Lesson 1: Dual Agencies in Maryland

Dual Agency 

Dual agency is the relationship wherein a licensed real estate broker acts as a dual agent. A duel agent is a licensed real estate that acts as an agent that represents both he buyer and the seller in the same trasanction. For instance, if a buyer that works under a brokerage agreement with a firm is interested in a property listed by the firm. A dual agent can’t act in the best interets of both parties, this presents a conflict of interest. 

Take note that eventhough the Dual agency is prohibited in the  §17-530(c) and (d) of the Business Occupation and Professions Article of the Maryland Code and exception exists: so long as the broker acquires an advanced written informed permission of all parties involved in the transaction, the broker can act as a dual agent in a transaction. MREC provides Consent for Dual Agency form to be used to acquire consent for dual agency. 

Licensees

In order to operate as a dual agency in Maryland, real estate teams are required to obtain and keep up-to-date three different licenses. This is because a dual agency uses three licensed agents to work all sides of a real estate transaction. These roles include:

• The seller’s intra-company agent,

• The buyer’s intra-company agent, and

• The “dual agent” - the broker or office manager who represents both parties collectively.

Written Consent 

Before a dual agency team can begin work with a client, they must notify the client in writing that the broker is representing both the buyer and the seller in the same transaction. In order to proceed, the dual agency team must then receive a signed consent form ("Notification for Dual Agency within Team") from the client, acknowledging this fact. 

Prior Approval

A buyer and seller must agree to work with a dual agency from the start. If a deal is negotiated, they must again confirm their consent to the purchase or sale of the property by the dual agency before the deal can become binding. 

Broker Withdrawal 

Should either the seller or the buyer choose not to consent to a dual agency (provided it has been disclosed) the broker hosting the dual agency may withdraw from representing either client? Doing so will not bring upon the broker or his real estate team penalties of any kind.

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Check for understanding!

What licenses must be held by a real estate team to operate in a dual agency?