Maine Real Estate License Practice Exam

Which agency represents clients who prefer to work with specific agents within a firm?

1. Designated agency

2. Transaction brokerage

3. Dual agency

4. Sub-agency

The correct answer is: Designated agency

Designated agency refers to a specific arrangement within a real estate firm where certain agents represent individual clients. In this setup, the agency designates one or more agents to work specifically with each client in a transaction, ensuring that the client's interests are prioritized and that there is a clear understanding of representation. This structure allows clients to feel more secure in their relationship with an agent, knowing that their specific needs and goals for the transaction are the primary focus of that agent, without conflicts that might arise from other agents working with different clients. In contrast, transaction brokerage does not establish an agent-client relationship but rather facilitates a transaction between the parties, lacking the fiduciary duties that come with designated agency. Dual agency occurs when a single agent represents both the buyer and seller in the same transaction, which can create conflicts of interest that designated agency aims to avoid. Sub-agency involves a relationship where one agent represents another agent’s client, which is not focused on the specific partnership between the client and the agent as designated agency is. Therefore, the nature of designated agency offers clients a more tailored experience, aligning with their preference to work closely with specific agents within the same firm.