What is the exam-ready answer?
| Official syllabus topic | Agency Disclosures, Dual Agency, and Conflicts |
|---|---|
| Official PSI area | Agency |
| Published area weight | 13% of the 100-question national portion |
| Exam portion | National salesperson portion |
| Source edition | PSI Georgia Candidate Information Bulletin dated July 1, 2026 |
The Rule
PSI publishes the weight for the complete content area, not a fixed question count for this lesson. Learn the rule well enough to apply it when PSI changes names, numbers, or parties in a new scenario.
The lesson
These ideas work together. On the exam, the wrong answers usually describe a nearby concept, so learn where each one stops.
Disclosure timing
Disclosure must occur at the time required by law and early enough for a person to understand whose advice is loyal before sharing confidential information or making a decision.
Dual agency
The brokerage or licensee represents both sides with informed consent, and advocacy and confidentiality are limited. Secret dual agency violates core duties.
Designated agency
Where permitted, the broker designates different affiliated licensees for different clients, with statutory procedures for supervision and confidentiality.
Personal and financial conflicts
A licensee's ownership, family interest, contemplated purchase, referral arrangement, or compensation source can be material and require clear disclosure.
Decision rule
Georgia-specific distinction
Worked example
Scenario. One affiliated licensee has a seller client and another has a buyer client in the same transaction under their broker's designated-agency procedure.
Reason it through. Separate licensees can advocate for their designated clients if Georgia's statutory consent, designation, supervision, and confidentiality requirements are met.
Answer. This can be designated agency rather than both individual licensees personally acting as dual agents.
Common exam traps
- Disclosing after confidential advice
- Treating designated agency as automatic
- Hiding a licensee ownership interest
- Assuming payment determines representation
Original practice questions with detailed explanations
These questions were written for instruction and mapped to the current outline. They are not copied from PSI or any live examination. Choose an answer before opening the explanation.
Question 1A Georgia brokerage has a signed listing with a seller. The listing licensee now wants to also represent a buyer who is interested in that same home. What must happen before the brokerage acts for both?
- A. The seller approves, since the listing came first
- B. The buyer hears a verbal explanation at the showing
- C. The broker notes the dual role in the file
- D. Both clients give informed written consent
Show answer and explanation →
Answer: D. Both clients give informed written consent
Georgia allows dual agency only after disclosure and the written consent of both clients, because each one gives up undivided advocacy. Seller-only approval is wrong because the buyer is also giving something up and must consent too.
Question 2Dana, a Georgia salesperson, wants to buy a home listed by another firm as an investment for herself. What must Dana do in this transaction?
- A. Disclose her license only if the seller asks
- B. Say nothing, since she is not acting as a broker
- C. Disclose that she holds a real estate license
- D. Disclose her license at closing on the statement
Show answer and explanation →
Answer: C. Disclose that she holds a real estate license
A licensee acting as a principal must disclose licensed status, because the other party is entitled to know they are dealing with a professional. Waiting to be asked, or until closing, fails the timing rule: the disclosure has to come before the seller relies on the dealings.
Question 3A buyer's agent will be paid through the listing brokerage's offer of compensation. The buyer asks whether that makes the agent the seller's representative. What is the best answer?
- A. Yes, whoever pays the fee controls the agency
- B. No, representation comes from the buyer's agreement
- C. Yes, unless the buyer pays a separate fee
- D. No, but the agent becomes a dual agent
Show answer and explanation →
Answer: B. No, representation comes from the buyer's agreement
Agency is created by the relationship and the buyer's agreement, not by where the money comes from. The idea that whoever pays controls the agency is the mistake, since cooperative compensation is common and changes no one's client status.
Ready to move on?
You are ready for the next lesson when all of these are true.
- Explain Agency Disclosures, Dual Agency, and Conflicts in one clear answer without notes.
- Separate Disclosure timing from Dual agency using a fresh example.
- Apply the decision rule to a new fact pattern and name the fact that controls the result.
- State the Georgia-specific point or explain why the national rule applies unchanged.
- Answer every practice question and explain the rule each rejected option misapplies.
- Revisit this topic later in mixed practice without category labels.
Recommended next lesson
Continue with Termination of Agency. Once you know whom the brokerage represents and what it must disclose, the next lesson covers how that relationship ends, by performance, expiration, revocation or operation of law, and which duties such as confidentiality and accounting outlast it.
Return to the Agency hub to see every official branch and the complete lesson sequence for this content area.