Before you read
Test yourself first: 5 questions
Question 1 of 5
Tennessee's brokerage law allows a single firm to represent both the buyer and the seller in the same transaction, with each party assigned a different agent in the firm so each receives full client-level representation. What is this Tennessee model called?
Answer: A. Tennessee uses designated agency, in which the principal broker appoints different affiliated licensees to represent the buyer and the seller. Each client gets full fiduciary-type representation from his or her designated agent, avoiding the conflicts of traditional dual agency.
Question 2 of 5
Under Tennessee's brokerage law, how is an agency (representation) relationship between a firm and a consumer typically created?
Answer: A. Tennessee provides that an agency or representation relationship is established by a written agreement to represent the consumer; absent such agreement the licensee is generally treated as a facilitator. Merely answering questions or showing property does not, by itself, create representation.
Question 3 of 5
A Tennessee broker has one affiliate representing the seller and another affiliate in the same firm representing the buyer in the same transaction. Which Tennessee agency concept allows the firm to handle this while assigning each client an individual representative?
Answer: B. Tennessee recognizes designated agency. The managing broker may designate one affiliate to represent the seller and another to represent the buyer, so each client receives individual representation within the same firm rather than forced dual agency.
Question 4 of 5
Tennessee maintains a fund to reimburse members of the public who obtain a court judgment against a licensee for fraud or misrepresentation in a real estate transaction but cannot collect it. What is this fund called?
Answer: A. Tennessee funds a Real Estate Education and Recovery Account that can reimburse injured consumers who hold an uncollectible judgment against a licensee arising from a covered transaction. It is funded by licensee fees and is distinct from the licensee's own E&O insurance.
Question 5 of 5
Which agency licenses and regulates real estate licensees in Tennessee?
Answer: A. The Tennessee Real Estate Commission (TREC) licenses and regulates real estate licensees in Tennessee. (Note: Texas also abbreviates its commission TREC.)
Keep the streak going with more questions like these, each with a full rationale.
What you need to know
Licensees typically act as agents owing fiduciary-style duties to their clients, but they may also work as facilitators (transaction brokers) who assist parties without representing either side. All licensees owe certain statutory duties, such as honesty and accounting, to every party in a transaction regardless of who they represent.
Tennessee's Agency and Representation Model: FAQs
Is Tennessee's Agency and Representation Model on the real estate exam?
Yes. State License Law is a scored domain on the Tennessee real estate licensing exam, and this topic appears in the state license-law 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.
Does Tennessee test this differently?
Tennessee applies its own license law on top of the national portion. This page covers the Tennessee rules specifically, which is what the state section of your exam tests.
