Sandra is selling her home in Birmingham and completes the Alabama seller disclosure form. After the form is delivered to the buyer, Sandra discovers a previously unknown water leak in the basement. The buyer has not yet signed the purchase agreement. What is Sandra's obligation under Alabama law?
Correct Answer
A) Sandra must update the disclosure form to reflect the newly discovered defect before the buyer signs the contract
Under the Alabama Seller Disclosure Act (Code of Alabama §6-9-142 and AREC Rule 790-X-3-.09), the seller's disclosure obligation is ongoing and requires updating if new material defects are discovered before the buyer enters into a binding contract. Because the buyer has not yet signed the purchase agreement, Sandra must update the disclosure form to accurately reflect the newly discovered water leak. Delivering a disclosure form that the seller knows to be incomplete or inaccurate can expose Sandra to fraud or misrepresentation liability.
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Marcus is selling a newly constructed home he built as a licensed contractor. The buyer's agent asks Marcus to complete the Alabama seller disclosure form. Which of the following correctly describes Marcus's obligation?
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