AgencyIntermediateArizona Exam

In Arizona real estate, 'agency disclosure' serves to:

ALimit the licensee's potential liability by creating a written record that the consumer was informed of the agent's capacity before any fiduciary duties arose
BInform consumers about the agency relationship so they understand who the agent represents and what duties they oweCorrect
CSatisfy the NAR Code of Ethics Article 9 requirement for written confirmation of all agency relationships at the time of first substantive contact
DDocument the commission agreement between the broker and client, since Arizona courts have held that agency disclosure is equivalent to a written fee agreement

Why Inform consumers about the agency relationship so they understand who the agent represents and what duties they owe Is Correct

Answer B: Inform consumers about the agency relationship so they understand who the agent represents and what duties they owe

Agency disclosure ensures consumers understand whether the agent represents them (owes fiduciary duties), represents the other party, or represents both parties. Informed consumers can make better decisions knowing whose interests the agent is protecting.

Exam Tip: Agency

Agency questions are among the most tested on the exam. Focus on the difference between client and customer, and memorize the fiduciary duties (OLD CAR). Watch for questions that try to blur the line between a general agent and a special agent.

Key Agency Terms in This Question

Agency

A legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.

Lien

A financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.

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