agency

designated agency

Designated agency is an arrangement, allowed in some states, in which a broker appoints one licensee in the firm to represent the seller and a different licensee to represent the buyer in the same transaction. Each designated agent advocates for their own client, while the broker typically remains a dual agent or neutral supervisor. Whether designated agency is allowed and how it works varies by state.

Exam tip: Exams test that in designated agency the individual agents are not dual agents, but the supervising broker usually is. Written consent from both parties is generally required.
Example: A buyer working with Agent Lee wants to buy a home listed by Agent Park at the same brokerage. The broker designates Lee for the buyer and Park for the seller.

1. A brokerage represents both seller and buyer in the same transaction. In states that allow it, what does designated agency typically involve?

Answer & explanation

Answer: B. Designated agency assigns separate licensees within one brokerage to each client, with consent and confidentiality protections, while the broker typically remains a dual agent. Freely sharing confidential information defeats the purpose.

Related terms & state variants

agency disclosure dual agency single agency transaction broker

Sources

Source verification pending. Confirm current requirements with your state regulator.

Last verified: 2026-10-23