How does split agency or assigned agency fix the dual agency problem as it applies to two brokers of the same firm representing clients on different sides of a transaction?

In the context of real estate transactions, split agency or assigned agency is a method that addresses the complexities of dual agency when two brokers from the same brokerage represent different parties in a transaction.

When a brokerage operates under a dual agency model, it represents both the buyer and the seller, potentially leading to conflicts of interest. However, with split agency, each broker is designated to act as a single agent for their respective client, meaning they owe full fiduciary duties to their client without divided loyalties. This arrangement clarifies responsibilities and reduces the risk of conflicts that typically arise in dual agency scenarios.

By designating agents as single agents while the firm maintains a dual agency status, the transaction is structured to provide protection for clients. Each client has dedicated representation that is committed to advocating solely for their interests, which enhances transparency and trust in the process.

This approach effectively mitigates the potential complications of dual agency, as each agent focuses exclusively on serving their client's needs and goals, thereby fostering a more ethical and legally compliant transaction environment.