Dual Agency and Hidden Conflicts: How to Spot a Real Estate Agent Working Against You

When you hire a real estate agent, you expect loyalty. You expect the agent to negotiate for you, disclose anything that affects your decision, and put your interests ahead of their commission. That is not just a courtesy. In most states, it is a legal duty called fiduciary duty. But some agents and brokers bend that duty when a bigger paycheck is on the table. One common problem is dual agency, where the same agent or brokerage represents both the buyer and the seller in the same transaction. It can be legal if everyone agrees in writing, but it often creates conflicts that cost ordinary people thousands.

Dual agency sounds harmless. The agent says, “I can handle both sides and save everyone time.“ What they may not explain is that the agent cannot fully advocate for either side. They cannot push hard for the buyer to get the lowest price while also trying to get the seller the highest price. They cannot tell the seller that the buyer will pay more, and they cannot tell the buyer that the seller is desperate. Instead, they become a middleman whose main goal is to close the deal and collect two commissions. In some cases, the brokerage gets both sides of the commission, which gives everyone at the firm a financial reason to keep quiet about defects, appraisal gaps, or better offers.

Watch for signs that your agent is not really on your side. If you are selling, a bad broker may bring you a buyer from their own office and discourage you from listing on the open market. They may say, “This is a strong offer, and if you wait, you might lose it.“ That pressure can be a sign they want a quick dual-agency payday. If you are buying, a bad agent may steer you toward homes listed by their own brokerage, even when other homes fit your needs better. They may avoid pointing out obvious problems because a difficult negotiation threatens their commission. Ask directly: “Are you representing me, the seller, or both of us?“ Get the answer in writing. Ask whether the brokerage will earn a commission from both sides. If the answers are vague, slow down.

Another form of misconduct is undisclosed referral fees. Real estate agents, lenders, title companies, inspectors, and contractors often work together. That can be convenient, but it can also be corrupt. A broker might recommend a home inspector who writes soft reports, or a mortgage broker who charges higher fees, because the broker gets a kickback. Federal law generally prohibits unearned fees and kickbacks in federally related mortgage transactions. Still, shady arrangements happen. If your agent insists you use only their inspector, title company, or lender, ask why. You are allowed to shop around. A professional agent should give you options, not ultimatums.

Pocket listings are another red flag. In a pocket listing, a home is marketed privately to a select group instead of being placed on the multiple listing service. Sometimes sellers want privacy. But sometimes brokers use pocket listings to double-end a deal, control the price, or favor a friend. If you are a seller, a pocket listing may limit exposure and cost you money. If you are a buyer, you may never see the home unless you are in the broker’s inner circle. Ask whether the property is on the MLS. Ask how long it has been marketed privately. Do not accept “that’s just how we do business.“

Finally, know your recourse. If you believe an agent or broker has lied, hidden a conflict, steered you unfairly, or charged an illegal fee, file a complaint with your state real estate commission, the Consumer Financial Protection Bureau, or your state attorney general. Keep copies of texts, emails, contracts, and disclosure forms. Write down dates and what was said. A paper trail turns a vague suspicion into a case.

A good real estate agent earns a commission by solving problems, not by creating them. If your agent cannot clearly explain who they work for, how they get paid, and why they recommend one company over another, treat that as a warning. You are protecting the largest financial transaction most families will ever make.