Why Should a Home Seller Refuse to Allow the Listing Agent Sign Them Up for “Dual Agency”? (#5 of 15 common mistakes we see home sellers make)

Sellers should not let listing agent be a "dual agent"

(Much of this material is taken from our previous blog on why Buyers should avoid dual agency.  To see that post, click here.  The material here has been modified to apply more to Sellers and fit our title.)

Missouri and a number of other states permit real estate agents to engage in something called “dual agency”.  Now, that may sound like an oxymoron, and in some ways, it is.  If somebody is my agent, they need to be loyal to me.


How can they also represent the other side and still be loyal to me???

Herein lies the secret to understanding the true difference between real estate agents, who are necessary to help most home sales get done, and lawyers, who are necessary if you want to protect yourself and your family from the shortcomings of the “standard” documents and from the incentives the marketplace provides to commissioned salespeople.

A “salesperson” sells you something.  They may be very educated, well dressed and well-spoken, but their loyalty is limited by their legal duties to others and sometimes to their monetary incentives.  Even a real estate agent or broker, who does have some fiduciary duties to their clients/customers, has limits to those duties.  In the case of dual agency, those duties are even further limited because they must be balanced against duties they have to the other side.  This can and, in our experience, often does leave a bad taste in the mouth of clients, who might feel either that their agent wasn’t really acting in their best interest, or at least that they are of limited usefulness in helping even though they collected what seems like a very large commission.

A lawyer is a fiduciary in the strictest sense of the word, able only to act in the best interests of the client, even in the case where there may be a monetary incentive to not do so.  The vast majority of lawyers, in our experience and certainly at our firm, given the gravity with which Bar Associations and Ethics Committees treat allegations of breach to the duty of loyalty attorneys owe their clients, will err on the side of losing out on monetary reward rather than risk even the appearance of acting in a way that is contrary to the best interests of the client.

The Seller in Missouri is usually paying 100% of the commission, yet in a dual agency situation, their agent’s loyalties are now split.  That’s simply not fair to the Seller who is paying the bill.  If a listing agent truly thinks this is somehow in the best interest of the Seller, one way to show it is to agree to pay for the Buyer to have their own representation so that the listing agent can continue with undivided loyalties to the Seller.  Another way to show it is to reduce their commission in exchange for keeping both buyer and seller sides of the commission.

As of the time of the writing of this blog post, we believe there are eight (8) states that have banned dual agency completely.  There are movements in the U.S. and Canada to ban dual agency altogether and while it is too early to determine if this is a trend that will catch on, Sellers should certainly beware and go into such arrangements with their eyes wide open.

In such danger situations, the presence of a lawyer can be particularly helpful in acting as a sounding board and a fiduciary who has only your best interests at heart.


In our next blog post, we plan to explore, “Jumping the Gun: Buying Your New House Before Selling Your Old One” (#6 of the 15 Mistakes We See Home Sellers Make Most Often). We hope you find the information helpful.

If you would like to have your own lawyer to help you on your next home purchase, just click here to sign up to be a client and pay nothing up front!



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