An Illinois licensee has actual knowledge of a latent physical defect in a listed property. The seller instructs the licensee to say nothing about it. Which statement correctly describes the licensee's legal obligation?
Correct Answer
D) The licensee must disclose the defect because Illinois law requires disclosure of latent material adverse facts actually known to the licensee, regardless of seller instructions.
Under the Illinois Real Estate License Act (225 ILCS 454/15-25), a licensee has an affirmative duty to disclose latent material adverse facts that are actually known to the licensee and that a reasonably diligent buyer inspection would not uncover. This duty is non-waivable — a seller's confidentiality instruction cannot override it because the statute is designed to protect buyers from hidden material defects that they have no practical means of discovering on their own.
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Related Topics & Key Terms
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Related Concepts
Environmental hazards disclosure involves informing buyers about environmental contamination or hazards affecting or potentially affecting a property, including underground storage tanks, contaminated soil, hazardous waste, and proximity to Superfund sites.
Flood zone disclosure requires informing buyers whether a property is located in a designated flood zone as mapped by FEMA. Properties in high-risk flood zones may require mandatory flood insurance.
HOA disclosure requires informing buyers about the existence, rules, fees, financial health, and restrictions of a homeowners association governing the property. This information helps buyers understand their obligations before purchase.
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