Authorized brokerage relationships & disclosure

If there's one section where I'd tell you to slow down and get every word right, it's this one. Brokerage relationships are heavily tested, and the exam writes questions designed to catch you confusing one relationship with another. Let's nail it.

The three relationships Florida allows

Florida recognizes exactly three authorized brokerage relationships:

• Transaction broker
• Single agent
• No brokerage relationship

And here's the rule that comes up again and again: dual agency is prohibited in Florida. Both disclosed and nondisclosed dual agency are off the table. If an answer choice describes an agent representing both buyer and seller as full single agents in the same deal, that's the wrong answer in Florida every time.

Transaction broker is the default

Start here, because the exam loves the word "presumed." In Florida, all licensees are presumed to be transaction brokers unless a single-agent or no-brokerage relationship is established in writing. The transaction broker is the default relationship.

A transaction broker provides limited representation to a buyer, seller, or both, without being a full advocate for either. It's the relationship most Florida agents operate under day to day.

The transaction broker's six duties

A transaction broker owes six duties. Memorize them:

1. Dealing honestly and fairly.
2. Accounting for all funds.
3. Using skill, care, and diligence in the transaction.
4. Disclosing all known facts that materially affect the value of residential property and are not readily observable to the buyer.
5. Presenting all offers and counteroffers in a timely manner, unless directed otherwise in writing.
6. Limited confidentiality, unless waived.

Now here's the part the exam zeroes in on: notice what a transaction broker does not owe. No loyalty. No obedience. No full disclosure. Those three are missing on purpose, and that's the heart of the contrast we'll draw in a moment.

The single agent's nine duties

A single agent represents one party fully, as a fiduciary. That party is the principal, and the agent is their advocate. A single agent owes nine duties:

1. Dealing honestly and fairly.
2. Loyalty.
3. Confidentiality.
4. Obedience.
5. Full disclosure.
6. Accounting for all funds.
7. Using skill, care, and diligence in the transaction.
8. Presenting all offers and counteroffers in a timely manner, unless directed otherwise in writing.
9. Disclosing all known facts that materially affect the value of residential property and are not readily observable.

If you stack that against the transaction broker list, the extra duties jump out. A single agent adds loyalty, obedience, and full disclosure, and the limited confidentiality of a transaction broker becomes full confidentiality.

The single agent vs. transaction broker contrast

This is the comparison the exam asks in a dozen different ways, so let me make it plain. Both relationships share five duties: honest and fair dealing, accounting for funds, skill/care/diligence, disclosing material facts not readily observable, and presenting offers timely.

The difference is what the single agent adds:

• Loyalty — putting the principal's interests first.
• Obedience — following the principal's lawful instructions.
• Full disclosure — telling the principal everything relevant.
• Full confidentiality instead of the transaction broker's limited confidentiality.

So a single agent is a full advocate. A transaction broker is a neutral facilitator who deals honestly with everyone but champions no one. When a question hinges on whether loyalty or obedience is owed, it's almost always testing this exact distinction.

No brokerage relationship and its three duties

The third option is no brokerage relationship, where the licensee deals with a member of the public but represents neither side. Even with no representation, the licensee still owes three duties:

1. Dealing honestly and fairly.
2. Disclosing all known facts that materially affect the value of residential property and are not readily observable.
3. Accounting for all funds entrusted to the licensee.

Notice that honest dealing, material-fact disclosure, and accounting for funds show up in all three relationships. Those three are the floor — you owe them no matter what.

Disclosure mechanics

Here's where a lot of study guides are out of date, so pay attention. The mandatory transaction-broker disclosure was removed in 2008. You do not have to hand someone a transaction-broker notice anymore, because it's the presumed default. If you see a question claiming a written transaction-broker disclosure is required, that's testing whether you know about the 2008 change.

What is still required in writing:

• The single-agent notice, when you're acting as a single agent.
• The consent-to-transition notice, when you move from single agent to transaction broker. The single agent can't just switch quietly; the principal has to consent in writing.
• The no-brokerage-relationship notice, given before showing property when that's the relationship.

Where these rules apply

One more boundary the exam tests: these disclosure requirements apply to residential sales of four or fewer units. They do not apply to nonresidential transactions, rentals and leases, auctions, appraisals, or business opportunities. So if a question describes a commercial lease or a business sale, the residential disclosure rules don't govern it.

This section is dense, and honestly, the duty counts (9, 6, and 3) are exactly the kind of thing that's easy to mix up under exam pressure. Drill them with our free practice exam until "single agent equals nine" is automatic.

Up next: Brokerage operations and escrow — trust-fund deadlines, conflicting demands, commingling, advertising rules, and the FREC's discipline ladder.