When is an agent considered a dual agent?

An agent is considered a dual agent when they represent both the buyer and the seller in the same transaction, and this representation is done with the informed consent of both parties. This means that the agent must fully disclose to both the buyer and the seller that they are acting on behalf of both in the transaction, ensuring that all parties understand the implications of this arrangement.

Dual agency is significant in real estate because it can create potential conflicts of interest, as the agent is tasked with balancing the interests of both parties. Therefore, obtaining informed consent is critical to maintaining ethical standards and transparency in the transaction. This consent allows the agent to navigate the complexities of representing two parties with potentially opposing interests while making sure that both are aware of and agree to the arrangement.

The other options do not fit the definition of dual agency. Representing only the buyer or only the seller would mean the agent is acting as a single agent for one party, and acting without a sponsorship agreement does not establish a formal agency relationship with either party.