What is "dual agency" in Colorado, and how is it typically handled?

• A. It means representing both sides; in Colorado, typically avoided through designated agency or transaction broker with disclosures
• B. It means representing the buyer only
• C. It means representing the seller only
• D. It is illegal in all cases

Answer: (B)

Dual agency is when one licensee or brokerage represents both the buyer and the seller in the same real estate transaction. In Colorado, this situation is managed to reduce conflicts of interest by using two main approaches with disclosures. One approach is designated agency, where two licensees within the same brokerage act as designated agents for each party, preserving loyalty and confidentiality for their respective client while the broker supervises. The other is a transaction broker arrangement, where the licensee assists both sides but does not owe fiduciary duties to either party, instead providing fair and honest help and clear disclosures. Both options require written consent from both parties and proper disclosures. Representing only the buyer is not dual agency; it is single agency for the buyer.