Dual Agency: Part 4 of 5

Part 4 of 5

Agency is such a big part of working with a real estate agent. Knowing who is working for who and how that impacts how you interact with the agents is an essential component to navigating the process of selling or buying a home. This is part 4 of 5 of a multi part series on agency. We go back a few weeks to September 6 and we have one more next week. Be sure to check out the entire series to get a full review of agency.


The big take away from previous entries in this series was to remember that your agreement is with the firm and not the agent. The real estate agent may be working to help you buy or sell your home but your legal agreement is with the firm. 

I like to tell my clients that I love them and the entire real estate process, but if I were to win the lottery tonight their transaction is safe with another agent in our firm. The agreement is with the firm and another agent in the firm will be taking over for me during my extended (permanent) vacation. 

While it doesn’t happen often, in reality a change in agent may happen if an agent changes firm in the middle of an agreement. I have also known clients to be unhappy with the job an agent is doing on their purchase or listing and the Broker In Charge (BIC) of the firm changes the agent assigned to the listing to keep things moving forward. 

Both sides of the coin

Due to the listing being with the firm, the possibility exist that a buyers agent could show a home by a listing agent from the same firm. This is called dual agency. The buyer would be represented by a different agent than the seller, but because the agency agreement is with the firm and not the specific agent, the firm is acting as a dual agent. When this happens it should always be disclosed to all parties. It’s typical and common and there’s no need for alarm, but everyone involved should be aware. 

In most cases your information is safe! The NC Real Estate Commission requires all legal documents be kept on file at the real estate office so the BIC has immediate access to everything. While I keep all the documents up to date at our office, I keep all personal information, notes, and additional documentation that would include private details a client wouldn’t want disclosed to the other side in my personal folder. This insures that while the firm is representing both sides, my client is protected as much as I possibly can. 


When you list with an agent or chose to buy with an agent, that agent will usually ask you if you would be ok with dual agency. You should never feel obligated to agree to dual agency. It should be a decision you are comfortable with. If you are a buyer and don’t allow dual agency, the firm that represents you won’t be able to show you homes listed with their firm. If you are a seller who choses not to allow dual agency, any buyers represented by the firm are immediately not eligible. Depending on the size and productivity of the firm, this could significantly limit your options and is a decision to be carefully considered. 

Ethical, legal and moral dilemma 

Keep in mind when you agree to dual agency you are also agreeing to allow the agent (who is a representative of the firm) to represent both sides of the transaction. In previous episodes I had discussed the duties of an agent. One of those is loyalty and while it’s possible to balance between both sides, it is extremely difficult in some situations. 

As a general rule and business practice I will not represent a buyer and seller on the same deal. I compare it to being a divorce attorney trying to work for the husband and the wife at the same time. My job as an agent is to get the best deal for my client. It would be nearly impossible to  make sure the seller and buyer walked away from the closing table with the best deal possible. There are agents who are highly skilled in this process. When both sides agree to dual agency its ethical and legal, but I am personally against it morally. I just can’t see how it’s fair to the clients if I am working in the middle of their deal. 


Pitfalls of Dual Agency

There are some pitfalls of dual agency. If an agent or firm is working on both sides of a deal they can’ t work for or against one side. Both the seller and buyer are clients of the other agent. This is certainly a delicate balance to be met. 

Additionally, if a single agent is working for both sides it may become difficult to determine if all the important information is being presented. I represented a seller and when he originally purchased a home he was not advised to get a home inspection. When his home went under contract, his buyers found many issues with the home that caused a tremendous amount of concern. These were items that had been present long before my client had purchased the home, but because his previous agent was representing the seller and buyers side of the deal, proper advising wasn’t done. His previous agent either couldn’t (or sadly wouldn’t) work on his behalf because of the conflict. It was a very difficult process that could have been avoided if my seller had been aware of the pitfalls of dual agency.

The end is near

The final entry in this series will be discussing the buyers agency agreement. Remember that there are plenty of additional videos. Blog entries and content on my web site and YouTube channel as well as my Facebook Page (Chris Whitehurst Real Estate).  If you think of someone that may find these valuable and helpful, please pass them along.

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Chris Whitehurst

Berkshire Hathaway-RW Towne Realty


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