- Official section
- National VI.C.1 and Illinois: Agency and representation disclosure
- Broker weight
- 13% of the national broker portion
- Expected scored items
- Agency accounts for about 13 of 100 national items
Illinois exam glossary
Agency disclosure
Agency disclosure is a timing rule disguised as a form question. The form matters, but the real goal is to prevent a consumer from sharing price limits, motivation, finances, or strategy with the wrong side. On every exam fact pattern, identify who is represented, who is only a customer, what must be written, when it must arrive, and whether a second consent is required.
Last updated: August 1, 2026
What does this exam area cover?
Short answer: Illinois designated agents disclose the relationship and the designated agent names in writing no later than beginning to work for the consumer. A licensee dealing with a customer gives written no-agency notice early enough to prevent confidential disclosure and never later than offer preparation. A representing licensee discusses the sponsor's compensation policy. Dual agency requires informed written consent from all clients and transaction-specific written confirmation before acting in that capacity.
This guide follows the PSI Illinois Candidate Information Booklet effective June 24, 2026, current 225 ILCS 454/1-10, 15-10, 15-25, 15-30, 15-35, 15-40, 15-45, and 15-50, plus Rule 1450.770 amended effective July 13, 2026, all checked through August 1, 2026. It distinguishes agency disclosure, brokerage agreements, compensation terms, material-fact disclosure, fair-housing notices, and transaction forms. Company policy may require earlier or additional documentation.
What is on the official outline?
- Topic
- Identify the consumer
- What to know
- seller, buyer, landlord, tenant, owner, prospective client, client, customer, unrepresented party, first contact, inquiry, showing, open house, online lead, and referral
- Best exam move
- Determine whether the person is represented before discussing confidential strategy.
- Topic
- Identify the licensee's side
- What to know
- listing side, buyer side, landlord side, tenant side, designated agent, sponsoring broker, other affiliated licensee, dual agent, no agent, ministerial assistance, and changing relationship
- Best exam move
- State whom the licensee represents, not whom the licensee is helping at that moment.
- Topic
- Apply designated-agency presumption
- What to know
- consumer being worked with, designated representation, written different relationship, sponsoring broker, legal agent, named licensee, exclusive designation, client, and statutory baseline
- Best exam move
- Illinois presumes designated agency unless the sponsor and consumer agree in writing to another relationship.
- Topic
- Disclose at the beginning
- What to know
- no later than beginning to work, before advice, early conversation, written notice, relationship exists, agent names, date, time, signature, delivery, and acknowledgment
- Best exam move
- Do not wait for an offer when the licensee has already begun acting as the consumer's designated agent.
- Topic
- Name the agents
- What to know
- individual licensee, multiple designated agents, team, assistant, sponsored licensee, managing broker, substitution, reassignment, amendment, consumer copy, and brokerage record
- Best exam move
- The disclosure must identify the actual designated agent or agents, not merely the company brand.
- Topic
- Choose combined or separate form
- What to know
- brokerage agreement, separate disclosure, incorporated section, completed names, signatures, date, consumer copy, sponsor copy, licensee record, company record, and electronic delivery
- Best exam move
- Either format works if the required disclosure, timing, copies, and records are satisfied.
- Topic
- Discuss compensation policy
- What to know
- sponsor policy, compensation terms, amount offered, cooperating broker, other party's representative, negotiable fee, buyer obligation, seller obligation, timing, written agreement, and transparency
- Best exam move
- Discuss who may be paid and on what terms without using payment source to infer agency.
- Topic
- Give no-agency notice
- What to know
- customer, not represented, written notice, protect confidential information, before price limit, motivation, urgency, finances, offer strategy, showing, offer preparation, and delivery proof
- Best exam move
- Give the notice before the customer reasonably reveals protected bargaining information and never later than offer preparation.
- Topic
- Continue customer duties
- What to know
- honesty, reasonable skill and care, material facts, ministerial acts, no advocacy, no confidential advice, statutory compliance, fair housing, offer assistance, and represented opposite party
- Best exam move
- No agency does not mean no duties, and limited assistance does not silently create representation.
- Topic
- Offer dual-agency disclosure
- What to know
- possibility, statutory language, risks, adverse interests, limited advice, confidential limits, independent advice, voluntary signature, all clients, brokerage-agreement entry, and before dual action
- Best exam move
- Present the statutory disclosure when the agreement is entered if the licensee offers dual representation.
- Topic
- Obtain informed consent
- What to know
- all clients, written consent, explanation, understanding, voluntary choice, no coercion, seller, buyer, landlord, tenant, named licensee, copy, and timing
- Best exam move
- One client's consent cannot authorize dual representation of both sides.
- Topic
- Confirm the transaction
- What to know
- prior consent, specific property, specific transaction, written confirmation, offer, purchase contract, lease, client signature, separate initials, named dual agent, and before acting
- Best exam move
- Initial general consent and transaction-specific confirmation are two separate checkpoints.
- Topic
- Respect refusal
- What to know
- client declines, voluntary consent, no dual agency, withdrawal, continue other client, separate agent, referral, referral fee, written fee disclosure, no prejudice, and documentation
- Best exam move
- A client may refuse; the licensee must restructure or withdraw rather than proceed as dual agent.
- Topic
- Bar self-dealing dual agency
- What to know
- licensee party, ownership interest, entity interest, buyer, seller, transaction, prohibited dual agent, personal acquisition, investment entity, conflict, and separate representation
- Best exam move
- A licensee or owned entity in the deal cannot use client consent to cure the statutory dual-agency prohibition.
- Topic
- Separate compensation and agency
- What to know
- payment source, promise of payment, listing broker, cooperating broker, buyer-paid fee, seller-paid fee, landlord-paid fee, tenant-paid fee, agency agreement, disclosure, and Section 15-40
- Best exam move
- Follow the relationship documents because compensation does not determine agency.
- Topic
- Update changed relationships
- What to know
- new designated agent, reassignment, team change, customer becomes client, client becomes customer, dual agency arises, transaction-specific consent, termination, new agreement, new copy, and file note
- Best exam move
- A disclosure accurate on day one is not enough after a material relationship change.
- Topic
- Preserve copies and proof
- What to know
- consumer copy, client copy, sponsor retention, company records, signed form, electronic record, delivery receipt, date, time, initials, agent names, transaction link, and audit trail
- Best exam move
- Compliance must be demonstrable, not merely remembered.
- Topic
- Separate other disclosures
- What to know
- agency status, compensation, dual consent, material fact, residential condition report, lead-based paint, fair housing, licensee interest, referral fee, latent defect, and transaction document
- Best exam move
- One signed disclosure does not satisfy every unrelated disclosure duty.
Which distinctions produce the most mistakes?
- Terms
- Consumer vs. client
- Difference
- Consumer is the broader person receiving or considering brokerage services. Client is represented under the brokerage relationship.
- Question cue
- Broad audience versus represented party.
- Terms
- Client vs. customer
- Difference
- A client receives representation. A customer receives services or information without agency from that licensee.
- Question cue
- Loyalty and advocacy versus honest limited assistance.
- Terms
- Agency disclosure vs. brokerage agreement
- Difference
- Disclosure identifies relationship status and agents. The agreement creates and defines the service, term, compensation, and contractual duties.
- Question cue
- Who represents whom versus complete engagement terms.
- Terms
- Designated-agent notice vs. no-agency notice
- Difference
- The first tells a consumer that named licensees represent them. The second warns a customer that the licensee does not represent them.
- Question cue
- You are my client versus you are not my client.
- Terms
- Dual consent vs. dual confirmation
- Difference
- Consent accepts the possibility and limitations of dual representation. Confirmation approves it for the specific transaction.
- Question cue
- General permission versus deal-specific approval.
- Terms
- Disclosure vs. consent
- Difference
- Disclosure supplies information. Consent is the client's informed and voluntary authorization after receiving it.
- Question cue
- Tell versus agree.
- Terms
- Signature vs. initials
- Difference
- When transaction confirmation is inside another document, the client signs the document and separately initials the dual-agency provision.
- Question cue
- Whole document plus targeted confirmation.
- Terms
- Assistance vs. representation
- Difference
- Ministerial help can be given to a customer without advocacy. Representation includes client-directed agency duties.
- Question cue
- Process help versus loyal advice.
- Terms
- Payment vs. agency
- Difference
- Compensation can come from a party the licensee does not represent. The payment direction does not establish the agency direction.
- Question cue
- Who pays is not who is represented.
- Terms
- Agency confidentiality vs. material disclosure
- Difference
- Client bargaining information is protected, while applicable material physical facts cannot be hidden as confidential information.
- Question cue
- Protected strategy versus required property truth.
- Terms
- Company name vs. designated-agent name
- Difference
- The company identifies the sponsoring broker. The disclosure must also name the individual designated agent or agents.
- Question cue
- Firm identity versus actual representative.
The W-H-O-M check
- Who: identify each consumer, client, customer, sponsoring broker, designated licensee, opposite party, and any licensee or entity interest in the transaction.
- How represented: classify designated agency, a written different relationship, no agency, or proposed dual agency, then match the classification to actual conduct.
- On-time writing: deliver the required named-agent or no-agency writing at the statutory time, obtain informed dual consent and specific confirmation when applicable, and provide copies.
- Money and records: discuss compensation policy and cooperating amounts, keep payment separate from agency, retain signed forms and delivery proof, and update the file when status changes.
- Disclosure
- Designated agency
- Deadline
- No later than work begins
- Proof
- Status and agent names
- Disclosure
- No agency
- Deadline
- Before secrets, never after offer prep
- Proof
- Written customer notice
- Disclosure
- Dual possibility
- Deadline
- At agreement entry if offered
- Proof
- Informed written consent
- Disclosure
- Specific dual deal
- Deadline
- Before dual action, normally at offer
- Proof
- Written confirmation
- Disclosure
- Compensation policy
- Deadline
- With represented consumer
- Proof
- Terms and cooperating amounts
- Disclosure
- Changed status
- Deadline
- Before acting in new role
- Proof
- Updated agreement and disclosure
How do the rules work in scenarios?
Buyer work begins
Scenario: A licensee starts advising a buyer on offer strategy and touring priorities. The licensee plans to provide designated-agency disclosure only when the buyer finds a home.
- The licensee has begun working as the buyer's designated agent.
- Section 15-35 requires written notice no later than that beginning.
- Waiting until a property is found is too late.
Answer: Provide the written designation and agent names when the agency work begins.
Listing agent meets unrepresented buyer
Scenario: At an open house, an unrepresented buyer begins explaining the highest price they can pay. The listing agent has not explained that the agent represents the seller.
- The buyer is a customer of the seller's agent, not that agent's client.
- No-agency notice must be timed to prevent disclosure of confidential information.
- The warning should come before the buyer reveals the limit.
Answer: Stop and provide written no-agency disclosure before receiving the buyer's confidential strategy.
General dual consent only
Scenario: A seller consented to possible dual agency when listing. Months later, the same licensee writes an offer for the buyer but obtains no transaction-specific confirmation.
- The first consent covered the possibility of dual representation.
- Illinois requires written confirmation for the actual transaction.
- The licensee cannot rely only on the listing-stage signature.
Answer: Obtain specific written confirmation from every client before acting as dual agent in this deal.
Confirmation inside contract
Scenario: A dual-agency confirmation appears in the purchase contract. Both clients sign the contract but neither initials the confirmation paragraph.
- The confirmation is included inside another signed document.
- Section 15-45 requires both signature of that document and initials on the confirmation provision.
- The targeted confirmation step is missing.
Answer: The embedded confirmation is not properly completed without the required initials.
Seller pays buyer broker
Scenario: The seller funds an amount used to compensate the buyer's brokerage. The seller claims that payment makes the buyer's licensee the seller's agent.
- Section 15-40 separates compensation from agency.
- The buyer's written agreement and disclosure establish representation.
- Payment source alone does not redirect loyalty.
Answer: The buyer's licensee remains the buyer's agent on these facts.
Client refuses dual agency
Scenario: A buyer refuses informed consent after learning that the same individual licensee represents the seller. The licensee pressures the buyer to sign because the fee has already been discussed.
- Consent must be voluntary and informed.
- Compensation does not override the refusal.
- The relationship must be restructured or the licensee must withdraw as allowed by law.
Answer: The licensee may not act as dual agent without the buyer's written consent.
Licensee buys the listing
Scenario: A listing licensee decides to buy the client's property personally and asks the seller to consent to the licensee serving as dual agent for both seller and buyer roles.
- The individual licensee is a party to the transaction.
- Section 15-45 prohibits dual agency when the licensee or an owned entity is a party.
- Disclosure and consent cannot cure the prohibition.
Answer: The licensee cannot serve as dual agent in that transaction.
What are the common exam traps?
- Trap
- Waiting until offer writing to disclose designated agency
- Correction
- Disclose no later than beginning to work as the consumer's designated agent.
- Trap
- Naming only the brokerage
- Correction
- Identify the designated agent or agents in the written disclosure.
- Trap
- Keeping the only copy
- Correction
- Retain the required brokerage record and provide a copy to the consumer or client.
- Trap
- Warning the customer after a secret is shared
- Correction
- Give written no-agency notice in time to prevent confidential disclosure.
- Trap
- Using disclosure as the entire buyer agreement
- Correction
- Include all current written brokerage-agreement terms, even if documents are combined.
- Trap
- Treating payment as agency
- Correction
- Section 15-40 says compensation does not determine representation.
- Trap
- Skipping compensation discussion
- Correction
- Discuss the sponsor's compensation terms and amounts offered to cooperating brokers representing other parties.
- Trap
- Using one client's dual consent for both
- Correction
- Every client must give informed written consent.
- Trap
- Using general dual consent as transaction confirmation
- Correction
- Obtain the second, deal-specific written confirmation.
- Trap
- Forgetting initials
- Correction
- If confirmation is embedded in another document, obtain the document signature and provision initials.
- Trap
- Forcing dual agency
- Correction
- A client may refuse, requiring separate representation or lawful withdrawal.
- Trap
- Charging an undisclosed referral fee after withdrawal
- Correction
- Disclose the referral fee in writing to both affected clients as Section 15-45 requires.
- Trap
- Letting an owner-licensee be dual agent
- Correction
- The statutory prohibition applies when the licensee or an owned entity is a transaction party.
- Trap
- Confusing disclosure with property-condition disclosure
- Correction
- Agency status and material property information answer different questions.
- Trap
- Leaving stale agent names in the file
- Correction
- Update documentation before a substitute licensee acts in a changed role.
Can you answer these original practice questions?
These questions are original study items aligned to the published outline. They are not copied, recalled, or predicted PSI questions.
1. When is Illinois designated agency disclosed?
- No later than beginning to work as designated agent
- Only after closing
- Only after inspection
- Only when commission is paid
Show answer and explanation
Answer: No later than beginning to work as designated agent
The notice must identify the relationship and named agents in writing.
2. When is no agency disclosed to a customer?
- Before confidential disclosure and no later than offer preparation
- After the customer reveals a price limit
- Only at closing
- Never in writing
Show answer and explanation
Answer: Before confidential disclosure and no later than offer preparation
The timing is designed to protect the customer's information.
3. Must the designated agents be named?
- Yes
- No
- Only the company
- Only the client
Show answer and explanation
Answer: Yes
The written disclosure identifies the agent or agents.
4. Does compensation determine agency?
- No
- Yes
- Only in sales
- Only in rentals
Show answer and explanation
Answer: No
Section 15-40 rejects payment source as determinative.
5. Who must consent to dual agency?
- All clients
- Only the seller
- Only the buyer
- Only the broker
Show answer and explanation
Answer: All clients
Consent must be informed and written.
6. What follows initial consent when a specific dual transaction arises?
- Written transaction confirmation
- No further step
- Only an oral reminder
- A deed recording
Show answer and explanation
Answer: Written transaction confirmation
Illinois uses a two-stage consent and confirmation process.
7. What is required when confirmation is inside a purchase contract?
- Contract signature and confirmation initials
- Only a broker signature
- Only an MLS note
- No client action
Show answer and explanation
Answer: Contract signature and confirmation initials
The provision itself must be initialed.
8. May a client refuse dual representation?
- Yes
- No
- Only after closing
- Only if unrepresented
Show answer and explanation
Answer: Yes
Consent is voluntary, so the licensee must restructure or withdraw.
9. Can a licensee who is buying the property serve as dual agent?
- No
- Yes with oral consent
- Yes after closing
- Yes if paid
Show answer and explanation
Answer: No
Section 15-45 prohibits it when the licensee or owned entity is a party.
10. Can agency disclosure be a separate document?
- Yes
- No
- Only for sellers
- Only for leases
Show answer and explanation
Answer: Yes
It may be separate or part of the brokerage agreement.
How should you study this area?
- Session
- Session 1
- Focus
- Sort the people
- Proof you are ready
- Classify 45 consumer, client, customer, seller, buyer, landlord, tenant, sponsoring broker, designated agent, opposite agent, and unrepresented-party facts.
- Session
- Session 2
- Focus
- Master timing
- Proof you are ready
- Solve 40 beginning-to-work, confidential-conversation, showing, open-house, offer-preparation, agreement-entry, transaction-confirmation, and changed-status deadlines.
- Session
- Session 3
- Focus
- Build the file
- Proof you are ready
- Audit 35 written-status, agent-name, consumer-copy, sponsor-copy, delivery, signature, initials, electronic record, amendment, and retention facts.
- Session
- Session 4
- Focus
- Control dual agency
- Proof you are ready
- Review 40 informed-consent, all-client, statutory-language, transaction-confirmation, initials, refusal, withdrawal, referral-fee, actual-knowledge, and self-interest questions.
- Session
- Session 5
- Focus
- Separate related duties
- Proof you are ready
- Drill 35 agency-agreement, compensation, no-agency, customer-duty, confidentiality, material-fact, fair-housing, lead, condition-report, and licensee-interest distinctions.
- Session
- Session 6
- Focus
- Run W-H-O-M
- Proof you are ready
- Audit two Illinois relationship files, score at least 90 percent, and state who, representation, on-time writing, money, and records aloud.
Do not count recognition as mastery. Close the notes and explain the rule, apply it to a new fact pattern, and identify why each distractor fails.
Practice the topic in Pass Illinois
From concept to decision
Drill this topic, then review the explanation
Pass Illinois gives you original national and Illinois questions, topic-by-topic study, clear explanations, timed practice, flashcards, progress tracking, and Math Coach. Start free, find the weak distinction, and focus the next session there.
Questions students ask about Agency Disclosure: Illinois Real Estate Exam Guide
What is an agency disclosure in Illinois real estate?
An agency disclosure tells a consumer whom a licensee represents, or does not represent, before the consumer reasonably mistakes assistance for loyalty. Illinois uses different disclosures for designated agency, no agency, and dual agency. A disclosure explains status and risk. It is not interchangeable with the written brokerage agreement that sets the relationship's services, term, compensation, and parties.
When must designated agency be disclosed in Illinois?
A licensee acting as a designated agent must advise the consumer in writing no later than beginning to work as a designated agent for that consumer. The notice states that designated agency exists, unless a written agreement provides a different relationship, and names the designated agent or agents. The practical exam rule is simple: disclose at the beginning, not after confidential strategy has already been shared.
Can the designated-agency disclosure be part of the brokerage agreement?
Yes. Section 15-35 allows the written designation to be included in the brokerage agreement or placed in a separate document. The sponsoring broker keeps a copy for licensee and company records, and a copy must be provided to the consumer or client. A completed file should prove names, status, timing, delivery, and retention.
When must no agency be disclosed to an Illinois customer?
A licensee must disclose in writing that the licensee is not the customer's agent at a time intended to prevent the customer from revealing confidential information, and never later than preparation of an offer to purchase or lease. Earlier is safer when the conversation is becoming personal, strategic, financial, or negotiation focused.
What compensation information must be discussed?
The licensee representing the consumer must discuss the sponsoring broker's compensation policy, including the terms of compensation and amounts offered to cooperating brokers who represent other parties. Compensation remains negotiable and does not determine agency by itself. The discussion does not replace the compensation terms required in the written brokerage agreement.
What disclosure is required for dual agency in Illinois?
Dual agency requires informed written consent from every client before the licensee acts for both sides. A licensee who offers dual representation presents the statutory disclosure at brokerage-agreement entry; a client may sign then or any time before dual agency begins. When a specific dual-agent transaction arises, the licensee must also obtain written confirmation of the prior consent, generally when the clients execute the offer or contract.
Is initial dual-agency consent enough for a specific transaction?
No. Illinois uses two steps. The first is informed written consent to the possibility of dual representation. The second is written confirmation that the client specifically consents to the named licensee acting as dual agent in the identified transaction. If the confirmation is inside another signed document, such as the purchase contract, the client must also initial the dual-agency confirmation provision.
Can a client refuse dual agency?
Yes. Consent must be informed and voluntary. A licensee may withdraw without liability from representing a client who does not consent to disclosed dual agency and may continue representing the other client. If the withdrawing licensee receives a referral fee, written disclosure of that fee must be made to both the withdrawing client and the client who remains represented.
Does paying a broker determine who the broker represents?
No. Section 15-40 says payment or promised payment is not determinative of agency. A seller, listing brokerage, buyer, landlord, tenant, or another source may fund compensation without changing the relationship disclosed and established by law and agreement. Follow the agency documents and conduct, not the direction of the check.
Does a disclosure form alone create a complete brokerage agreement?
Not necessarily. A designated-agency disclosure identifies representation and named agents, while a brokerage agreement sets the terms of the relationship. Current Rule 1450.770 requires written seller or owner, buyer or tenant, and property-management agreements at the stated times and requires specific content. The documents can be combined, but every legal function still needs its required terms.
Are these official PSI questions or legal advice?
No. The practice questions are original. The PSI Illinois outline, Illinois Real Estate License Act, and Rule 1450.770 were checked through August 1, 2026. This is exam education, not legal, brokerage, ethics, commission, disclosure-form, contract, or transaction advice. Live practice requires the current approved company forms, signed brokerage agreement, named licensees, proof of delivery, dual-consent status, compensation policy, transaction facts, sponsor supervision, and legal advice when relationships are disputed.
Primary sources
- PSI Illinois Candidate Information Booklet effective June 24, 2026
- Illinois General Assembly, 225 ILCS 454/1-10 client, customer, confidential information, and brokerage definitions
- Illinois General Assembly, 225 ILCS 454/15-10 designated-agency presumption
- Illinois General Assembly, 225 ILCS 454/15-25 customer duties and ministerial acts
- Illinois General Assembly, 225 ILCS 454/15-30 continuing confidentiality
- Illinois General Assembly, 225 ILCS 454/15-35 agency relationship, compensation-policy, and no-agency disclosure
- Illinois General Assembly, 225 ILCS 454/15-40 compensation does not determine agency
- Illinois General Assembly, 225 ILCS 454/15-45 dual-agency disclosure, consent, confirmation, withdrawal, and prohibition
- Illinois General Assembly, 225 ILCS 454/15-50 written brokerage agreement and designated agents
- Illinois General Assembly JCAR, 68 Ill. Adm. Code 1450.770 amended effective July 13, 2026
The current official outline controls the tested scope. Statutes, regulations, and official agency materials control when a general study rule and a jurisdiction-specific rule differ.
Editorial status
Checked against primary sources
The Pass Illinois editorial team last checked this guide on August 1, 2026. Every practice question is an original study item, and the source links above let you verify the rules that support the lesson.