Maine Real Estate License Practice Exam

How is an agency relationship formed in Maine?

1. By Maine Consumer Protection statutes

2. Through specific real estate regulations

3. By agreement between the principal and agent

4. Based on verbal consents between the parties

The correct answer is: By agreement between the principal and agent

An agency relationship in Maine is formed by agreement between the principal and agent. This agreement establishes the legal and professional connection necessary for the agent to act on behalf of the principal. It is the mutual consent to create an agency relationship that allows the agent to represent the principal in real estate transactions, making it essential for there to be a clear understanding and acceptance of their roles. The agreement can be in written or oral form, but it is highly encouraged for it to be in writing to ensure clarity and to document the terms of the agency relationship. This formal agreement sets out the responsibilities and duties of both parties, fostering transparency and trust. Other options may touch on relevant aspects of real estate practice, but they do not define the agency relationship itself. While Maine Consumer Protection statutes and specific real estate regulations provide a framework within which agents operate, they do not themselves create an agency relationship. Similarly, verbal consents may imply a relationship but do not provide the same level of formality and security that a mutually accepted agreement does.