Idaho Real Estate Practice Exam

Which duty is NOT owed by a brokerage to a customer in the context of real estate?

1. Provide agency disclosure

2. Maintain confidentiality of information

3. Assist the customer in negotiations

4. Disclose potential conflicts of interest

The correct answer is: Provide agency disclosure

In the context of real estate, a brokerage's relationship with a customer typically involves certain duties that are guided by law and ethical standards. The obligation to provide agency disclosure is an important duty owed to clients rather than customers. In a real estate transaction, customers are individuals with whom the brokerage does not have a fiduciary relationship; therefore, the brokerage is not legally required to provide agency disclosures to them. Agency disclosure is primarily a duty to the client because it informs them about the nature of the representation and the agent's responsibilities. This distinction highlights the nature of the relationship where fiduciary duties like loyalty and full disclosure apply only to clients. In contrast, maintaining confidentiality of information, assisting in negotiations, and disclosing potential conflicts of interest can all be part of the responsibilities a brokerage might undertake for customers, depending on the specific scenarios and agreements in place. These duties help foster trust and transparency, even though the brokerage does not owe the same level of loyalty and responsibility to customers as it does to clients.