Michigan Agency Law Guide for the Real Estate Exam

Michigan Agency Law Guide

Agency questions appear on both sections of the Michigan real estate exam. Michigan has specific rules around buyer agency agreements and disclosure that are tested in the state section. Get these locked in before exam day.

Michigan Agency Relationships

Seller's Agent — Represents the seller exclusively. Owes all fiduciary duties: loyalty, obedience, disclosure, confidentiality, accounting, and reasonable care. Must disclose agency status to all customers at first contact.

Buyer's Agent — Represents the buyer exclusively. Michigan requires a written buyer's agent agreement to establish buyer representation. Without this agreement in writing, the licensee cannot legally act as a buyer's agent.

Dual Agent — Represents both seller and buyer in the same transaction. Requires written informed consent from both parties. A dual agent cannot disclose the seller's lowest acceptable price or the buyer's highest willingness to pay.

Designated Agent — Within one brokerage, one agent represents the seller and another represents the buyer. Each designated agent owes full fiduciary duties to their respective client. The broker acts as a dual agent while the individual agents remain single-agent advocates.

Non-Agent (Facilitator) — Michigan allows licensees to assist parties without forming an agency relationship, with written disclosure. A facilitator owes honesty and fair dealing but not fiduciary duties.

Michigan-Specific Agency Rules

Written Buyer's Agent Agreement. Michigan requires a written agreement to establish buyer representation. An oral buyer agency relationship is not enforceable. Without a written agreement, the licensee is acting as a non-agent facilitator or as a seller's subagent (if no other relationship is established).

Agency Disclosure at First Contact. Michigan licensees must disclose their agency status (or non-agency status) in writing at the first contact with a buyer or seller. The disclosure must identify who the licensee represents.

Disclosure of Dual Agency. When dual agency arises, Michigan requires full written disclosure and written consent from both parties before the dual agency can proceed. If consent is not obtained, the licensee cannot represent both parties.

Fiduciary Duties

For seller's agents and buyer's agents, the fiduciary duties are: - Loyalty — Prioritize the client's interests - Obedience — Follow lawful instructions - Disclosure — Share all material information - Confidentiality — Protect client confidences - Accounting — Handle client funds properly - Reasonable care — Exercise professional skill

Common Exam Mistakes

Assuming oral buyer agency is valid. Michigan requires it in writing.

Confusing dual agent duties. A dual agent cannot share one party's confidential information with the other. Candidates who say dual agents must disclose everything are wrong — confidentiality still applies.

Missing the first-contact disclosure requirement. Michigan licensees must disclose agency status at first contact — not at the time of showing or when an offer is made.

Practice Michigan Agency Questions

[CARealestate.com/states/michigan](https://carealestate.com/states/michigan) has Michigan agency law practice questions with detailed explanations. 5 free questions — no signup needed.