Subagency
A subagent is a broker or salesperson who works for the listing broker, not directly for the seller. Because the listing broker is the seller's agent, the subagent inherits the same side of the deal and owes the seller the fiduciary duties of loyalty and confidentiality. The buyer stays a customer, owed honesty and disclosure, not loyalty.
Subagency is tested in the Agency section, often by asking who a subagent represents or which duty an agent does not owe to a third party. The point turns on the chain of representation, from seller to listing broker to subagent.
Who a subagent works for
A subagent is the agent of the listing broker. The listing broker is the agent of the seller, so the subagent is one step removed in a chain that starts with the seller and runs down through the broker. Common examples are a cooperating broker who brings a buyer to another broker's listing, that broker's salespeople, and the listing broker's own salespeople when they act under the listing. In each case the subagent is working for the listing broker, on behalf of the seller.
Fiduciary duties flow down the chain
Because the subagent stands on the seller's side, the subagent owes the seller the same core fiduciary duties the listing broker owes: loyalty, confidentiality, and the rest. Working through another broker does not dilute those obligations. The subagent's job is to advance the seller's interest in the transaction, which is why a subagent cannot secretly negotiate against the seller's position.
The buyer stays a customer
The buyer in a subagency transaction is a customer, not a client. A customer is owed honesty and fair dealing, disclosure of known facts that affect the transaction, and freedom from misrepresentation. A customer is not owed loyalty, and not owed confidentiality. This split between client and customer is where many exam questions live, because it explains why a subagent can be paid by the seller while dealing fairly with the buyer.
A concrete example
Imagine a seller lists a condo with a broker. A broker from a different firm, acting as a subagent under a cooperating arrangement, finds a buyer and negotiates the sale. That cooperating broker owes the seller loyalty and confidentiality and must disclose known facts to the buyer, but does not owe the buyer loyalty. If the buyer later asks the cooperating broker for advice that conflicts with the seller's interest, the subagent cannot simply switch sides.
Where subagency has gone
Traditional subagency has faded in much of the country. Many states and multiple listing services now default to buyer agency, where the broker who works with the buyer represents the buyer, or to transaction broker or facilitator relationships, where the licensee helps both parties without representing either. Because the rules differ by state and by service, the relationship a broker actually has is what matters, not the historical label attached to it.
How the exam tests subagency
Expect questions that ask who a subagent represents, or ask which duty is not owed to a third party. Place the subagent correctly in the chain, seller to listing broker to subagent, and the representation answer follows. For the duty question, remember that loyalty and confidentiality attach to clients, not to customers, so they are the duties not owed to a third party. Read the scenario carefully when a state has moved past subagency, and answer based on the relationship the question describes.
Memory trick
SUBS
Use S-U-B-S to place a subagent correctly in the deal.
- S
Same side as the seller: the subagent represents the seller's interests, working through the listing broker
- U
Undivided loyalty: the subagent owes the seller full fiduciary duties, not neutrality between the parties
- B
Buyer is a customer: the buyer receives honesty and disclosure but no loyalty or confidentiality from the subagent
- S
Shares the commission: a cooperating subagent is usually paid out of the listing broker's commission
Screenshot this: SUBS is how you'll remember subagency on exam day.
How the exam tricks you on this
The classic trap is assuming the cooperating broker who brings the buyer is the buyer's agent. In a traditional subagency, the broker who finds the buyer still works for the seller through the listing broker, so the buyer remains a customer of that broker, not a client. A question will hand you a selling agent from another brokerage and expect you to place that agent on the seller's side of the deal.
Two more patterns to watch:
- Customer duties are limited. A subagent owes a third-party customer honesty, fair dealing, disclosure of known facts, and no misrepresentation, but not loyalty or confidentiality. A question asking which duty is not owed to a third party is pointing at loyalty and confidentiality.
- Practice has moved past subagency. Many states and multiple listing services have replaced traditional subagency with buyer agency or transaction broker relationships. Read the scenario's description of the working relationship instead of relying on the old label.
Try real exam questions on subagency
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A subagent is the agent of
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Related terms
Dual Agency
Dual agency is when one agent represents both the buyer and the seller (or both landlord and tenant) in the same transaction. Because the agent can no longer give either side undivided loyalty or full disclosure, both parties must give written, informed consent before it can happen, and the agent must stay strictly neutral on price and negotiating strategy for the rest of the deal.
Read definitionFiduciary Duties
Fiduciary duties are the six legal obligations a real estate agent owes their client: obedience, loyalty, disclosure, confidentiality, accounting, and reasonable care, remembered as OLDCAR. They require the agent to place the client's interests above everyone else's, including the agent's own.
Read definitionTypes of Listing Agreements
There are four main types of listing agreement: open listing, exclusive agency, exclusive right to sell, and net listing. They differ in one thing, who the broker gets paid by. Under an open listing the broker is paid only if they are the one who brings the buyer, under exclusive agency the owner can still sell the property themselves and owe nothing, and under exclusive right to sell the broker earns a commission no matter who sells.
Read definitionProcuring Cause
Procuring cause is the broker's effort that leads to a sale, the link between the broker's work and the customer's decision to buy. The broker who was first to find the customer and whose efforts induced the transaction has earned a commission, even when another agent or the owner later closes the deal.
Read definition
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