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Real Estate Agency: Learn All About Real Estate Agency Relationships In Georgia

If you are considering purchasing a home or refinancingyou can go to or along with local mortgage lenders in your areato determine what loan will best suit youand your family.  You can compare closing costs, APR's and Par rates to determine what loan will best serve yourand your family's long-term interests.

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Real Estate Brokers are licensed professionals trained to help consumers buy, sell, or lease real property.  In this discussion I will describe the five most common types of Brokerage Relationships offered by Real Estate Brokers in Georgia.

It should be noted that Real Estate Brokers are not required to offer all of the Brokerage Relationships described in this discussion.

Instead, each Real Estate Broker is free to decide which of these relationships he or she will offer.

Many Full Service Brokerage Companies offer all five of the following Brokerage Agency Relationships:

*  Transaction Brokerage (No Agency or Legal Relationship Created)

1.  Single (Seller/Landlord) Agency

2.  Single (Buyer/Tenant) Agency

3.  Designated Agency (Listing Brokerage Company designates one Agent to Represent the Buyer & one Agent to represent the Seller)

4.  Dual Agency (A Single Brokerage Company has one Agent that Represents both the Buyer & the SellerMust have Written consent of Both Parties)

5.  Sub-Agency (Selling Brokerage Company is the Sub-Agent/Appointed Agent of Listing Company & the Buyer is the CUSTOMER of the Selling Brokerage Companyand the Seller is the CLIENT of the Listing Brokerage Company)

As a general rule, in the State of Georgia only licensed Real Estate Brokers can be paid a fee to help consumers buy, sell, or lease property.

All Brokerage Firms are required to have a responsible or qualifying broker!

In the majority of real estate transactions, the consumer interacts only with his or her real estate agent and not the Real Estate Broker.

Buyers and Sellers can elect to have no agency relationship and they would not be represented by a Broker, they would each be solely responsible for protecting their own interests, and the Broker’s role would be limited to performing ministerial acts for that party.

All Brokerage Relationships fall into one of two broad categories:

1) Broker-Customer Relationships

With this type of relationship, the Broker IS NOT representing the customer in a LEGAL OR AGENCY capacity.

However, the Broker can still work with the “CUSTOMER” and help him or her by performing what are known as ministerial acts.

These include, for example, identifying property for sale or lease, providing pre-printed real estate form contracts, preparing real estate contracts at the direction of the customer, and locating lenders.

2) Broker-Client Relationships

In a Broker-Client Relationship, the Real Estate Broker is representing the “CLIENT” and is acting as his or her legal agentin buying, selling, or leasing property.

In Georgia, a Broker-Client Relationship can only be formed by the parties entering into a "written agreement."

The agreement must explain, among other things, how the Broker will be paid, the duty of the Broker to keep the client confidences, and the types of client or agency relationships offered by the Broker.

Brokerage relationships within each of these categories are discussed below:


Transaction Brokerage

A Transaction Brokerage Relationship is one in which a Real Estate Broker or Brokers assist both parties in a real estate transaction but does not enter into a client relationship with, either party.

In a Transaction Brokerage Relationship, the Broker treats both parties as CUSTOMERS and can only perform ministerial acts for either party, including the following:

1. Identifying property

2. Providing real estate statistics and information of property

3. Providing pre-printed real estate form contracts

4. Acting as a scribe in the preparation of form contracts

5. Locating relevant professionals, such as architects, engineers, surveyors, inspectors, lenders, insurance agent, and attorneys; and

6. Identifying facilities such as schools, shopping centers, and places of worship.

Brokers may help parties other than their clients:

Brokers who represent one party in a transaction as a CLIENT can still help the other party in the transaction by performing ministerial duties for the other party (of the type described under transaction brokerage sectionabove).

When a Real Estate Broker works with a party as a CUSTOMER or CLIENT, the Broker may not knowingly give the party false information.


Seller /Landlord Agency

I. Seller Agency/Landlord Agency:

Seller agency occurs when the Real Estate Broker is representing the seller in selling his or her property.

This type of Brokerage Relationship is created by the seller and the Broker entering into a written contract known as a Listing Agreement.

The "Listing Agreement" gives the Broker, commonly referred to as the Listing Broker, the right to market the property for sale at a specific price and for a defined period of time.

If the Broker is successful in finding a buyer ready, willing, and able to purchase the property, the Broker would normally be paid a fee or commission upon the closing of the transaction.

This fee or commission is often shared with other Real Estate Brokers, under what are known as Cooperative Brokerage Agreements, if they or their agents find the buyer.

Seller Agency is also sometimes called Listing Agency.

Landlord Agency is different from Seller Agency in that the Listing Broker is assisting the property owner in "leasing" rather than selling property.

Buyer/Tenant Agency

II. Buyer Agency/Tenant Agency:

Buyer Agency occurs when the Real Estate Broker represents the buyer in locating and assisting the buyer in negotiating for the purchase of property suitable to the buyer.

A Buyer Agency is created when the buyer enters into an agreement commonly known as a Buyer Brokerage Agreement.

A Real Estate Broker can be compensated by one party yet represent another party.

Therefore, in some Buyer Brokerage Agreements, the fee or commission received by the Buyers Brokerage is actually a portion of the fee or commission paid by the seller to the Listing Broker.

In these situations, the seller also agrees that the Listing Broker will share the commission or fee with any Buyer’s Broker who finds a buyer ready, willing and able to purchase the property.

With some Buyer Brokerage Agreements, the buyer pays a fee or commission directly to his or her Broker.

Buyer Agency is sometimes referred to as Buyer Brokerage.

Tenant Agency is different from Buyer Agency in that the Broker is representing a consumer who is "seeking to lease" rather than purchase property.

Designated Agency

III. Designated Agency:

In some real estate transactions, the real estate agent representing the buyer and the real estate agent representing the seller both work for the same Broker or Brokerage Firm.

In such a transaction, the Broker may allow each agent to exclusively represent their respective clients.

This type of brokerage relationship is known as Designated Agency.

In a Designated Agency transaction, the designated agent for the buyer owes the same duties to the buyer as if the agent was acting only as a buyer’s agent.

Similarly, the designated agent for the seller owes the duties to the seller as if the agent was acting only as the seller’s agent.

With Designated Agency, each designated agent is prohibited from disclosing to anyone other than his or her Broker any information requested to be kept confidential by the client unless the information is otherwise required to be disclosed by law.

Therefore, designated agents may not disclose such confidential information to other agents in the company.

The Broker is also prohibited from revealing any confidential information he or she has received from one designated agent to the other designated agent, unless the information was otherwise required to be disclosed by law.

Confidential information is defined as any information that could harm the client’s negotiating position with information the client has not consented to be disclosed. In Georgia, Designated Agency is defined by state statute—not to be Dual Agency.

Dual Agency

IV. Dual Agency:

Georgia law allows Real Estate Brokers to act as Dual Agents if they first get the written consent of both parties.

The written consent must contain the following:

1.  A description of the types of transactions in which the licensee will serve as a Dual Agent.

2.  A statement that as a Dual Agent, the licensee represents two clients whose interests could be differentor even adverse.

3.  A statement that the Dual Agent will disclose all adverse material facts regarding the transaction known to the Dual Agent to all parties to the transactionexcept for information that is made confidential by request of another clientand that is not allowed or required by lawto be disclosed.

4.  A statement that the licensee will disclose to each client in the transaction the nature of any material relationship the licensee or his or her Brokerhave with other clients in the transactionother than incidental to the transaction.

5.  A statement that the client does not have to consent to the Dual Agency.

6.  A statement that the client’s consent has been given voluntarily and that the client has read and understood the Brokerage Engagement Agreement.

This special consent is required because of the "potential for conflicts of interest" in Dual Agency transactions!


V. Sub-agency:

Sub-agency occurs when one Real Estate Broker is appointed by another Real Estate Broker as a Sub-agent to assist the Broker in performing its duties.

In a typical Sub-agency transaction, a Listing Broker practicing Sub-agency might appoint the Broker working with the buyer as his or her Sub-agent.

The Broker acting as the Sub-agent would work with the buyer but would represent the seller.

The buyer then was the CUSTOMER of the Broker acting as a Sub-agent, but the seller would be his or her CLIENT.

Sub-agency relationships between Real Estate Brokers in Georgia, while once the norm when I first started my career in the Real Estate Industry in the early 1990's, are much less common in Georgia today.

About This Article:


The above article was written by Thomas (TJ) Underwood.   Thomas (TJ) Underwood is an active real estate broker in the state of Georgia and is the writer behind The Wealth Increaser, Home Buyer 411,  Home Seller 411, The 3 Step Structured Approach to Managing Your Finances, Managing & Improving Your Credit & Finances for this MILLENNIUM and CREDIT & FINANCE IMPROVEMENT MADE EASY—FREE GUIDE. 

He is the creator of where he regularly blogs about helping consumers improve their credit, finance and real estate pursuits in an intelligent, consistent and proactive manner.  He’s always looking for ways to make intelligent finance improvement happen for those who “sincerely desire” success in their future. 

You can contact him from a number of sources but the most direct way is to contact him through the contact us block that can be found at the bottom of this page. 

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If you are considering purchasing a home or refinancingyou can go to or along with local mortgage lenders in your areato determine what loan will best suit youand your family.  You can compare closing costs, APR's and Par rates to determine what loan will best serve yourand your family's long-term interests.

Thomas (TJ) Underwood has been providing financial advice as a tax practitioner since the mid 1980’s and began his financial planning career (while earning a Bachelor of Science Degree in Business Administration/Finance/Marketing), in Detroit at Wayne State University.  From 2010 up to the present he continues to provide visitors timely personal finance and wealth building advice and articles—including real estate advice—on 3 sites that he has created since 2010. 

Even though he is an active real estate Broker in the Atlanta Metropolitan area, he continues to blog consistently to help visitors and those who desire lasting financial and life changing success the opportunity to change their life for the better in a more efficient way. 

You can learn more about him and gain access to all three sites that he has created by going to Who is the creator of page.

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