Before you read
Test yourself first: 5 questions
Question 1 of 5
At an open house, an unrepresented visitor tells the listing agent, 'We'd go to $520,000 if we had to.' The visitor later offers $495,000 through their own agent. The listing agent should:
Answer: B. The visitor is a CUSTOMER; the seller is the CLIENT. Material information voluntarily revealed by a customer — like willingness to pay more — must be passed to the client under the duty of disclosure. Confidentiality protects clients, not customers.
Question 2 of 5
A buyer shown homes by the seller's agent, with no representation agreement, is the agent's:
Answer: B. Without a representation agreement the buyer is a customer (owed honesty and fairness), not a client (owed fiduciary duties).
Question 3 of 5
An agent should disclose whom they represent:
Answer: B. Agency relationships should be disclosed at the first substantive contact so the other party knows whether they are a client or a customer.
Question 4 of 5
Even toward a customer (a non-client), a licensee must always be:
Answer: A. Fiduciary duties are owed to clients, but honesty, fairness, and disclosure of known material facts are owed to everyone, including customers.
Question 5 of 5
What is the key difference between a client and a customer in an agency relationship?
Answer: B. The client (principal) is owed full fiduciary duties; a customer is a non-represented party owed only honesty, fairness, and disclosure of material defects.
Keep the streak going with more questions like these, each with a full rationale.
What you need to know
The CUSTOMER is the unrepresented party: they are owed honesty, fair dealing, and disclosure of known material facts about the property, but no loyalty and no advice. A listing agent must disclose a leaky roof to a buyer-customer but must NOT reveal the seller-client's willingness to take less. Crossing that line — coaching the customer on negotiation — creates implied agency and possibly undisclosed dual agency, one of the most-tested liability traps.
Customer vs Client: FAQs
Is Customer vs Client on the real estate exam?
Yes. Agency & Fiduciary Duties is a scored domain on the real estate licensing exam, and this topic appears in the national portion.
Is this cheat sheet free?
Yes — every page on Cinna RE's resource library is free to read, print and share. The app adds practice questions, mock exams and a readiness score.
