During a listing appointment in Pontiac, a seller informs her agent that the property is located in a flood zone but says she does not want to disclose this because it might scare away buyers. The property is a single-family home subject to the Michigan Seller Disclosure Act. Which of the following actions should the agent take?
Correct Answer
B) Advise the seller that flood zone status is a material fact that must be disclosed, and that failing to do so could expose both the seller and the agent to liability
Under the Michigan Seller Disclosure Act (MCL 565.957) and the Michigan Occupational Code (MCL 339.2512d), both the seller and the agent have obligations regarding material facts. Flood zone status is a material fact that affects the value and insurability of the property. The agent must advise the seller of the legal obligation to disclose this information and explain that omitting it could expose both parties to civil liability and, for the agent, disciplinary action under LARA-BPL.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Violating fair housing laws can lead to significant penalties, including fines, civil liability, and professional discipline.
Death on property disclosure addresses whether sellers must inform buyers about deaths that occurred on the property, including natural deaths, suicides, and murders. Requirements vary significantly by state.
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.
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