Dear Sacto Buyer: If you are comfortable with the listing agent, which it sounds like you are, and you are clearly knowledgeable about agency relationships, your decision to work with the listing agent would not be uncommon in today's Sacramento market. That listing agent will owe you and the bank owner his or her best efforts to work on each of the partys' behalf to conclude the transaction.
But I have to tell you that if a higher or better offer comes in, the listing agent will have a duty to present that offer to the bank owner. That will put him or her in a difficult position with you. Homes in Arden Park are a hot commodity right now.