A Colorado broker is assisting a buyer under a transaction brokerage relationship. The broker discovers that the property's roof has significant hidden water damage that the seller has not disclosed. What is the broker's obligation under Colorado law?
Correct Answer
D) Disclose the material information to the buyer regardless of the transaction brokerage status
Even in a transaction brokerage relationship in Colorado, the broker retains the duty to disclose all known adverse material facts that could affect the buyer's decision. Under C.R.S. § 12-10-407, transaction brokers must disclose known adverse material facts about the property. Hidden roof water damage is a classic adverse material fact. The broker cannot withhold this information simply because the relationship is transaction brokerage rather than full representation.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A relationship where a listing broker authorizes other brokers to act as agents of the seller, extending the seller's agency relationship to cooperating brokers.
A non-agency relationship where the broker facilitates a real estate transaction without representing either party, owing limited duties of honesty, fairness, and competence to both.
The legal principle that holds a broker responsible for the actions of their agents and employees performed within the scope of the agency relationship.
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