During a walkthrough of a property she has listed, an agent sees water stains on a ceiling and smells a strong musty odor in the basement. She mentions neither to prospective buyers, explaining later that she is not a home inspector and could not confirm that anything was actually wrong. Which statement best describes her obligation?
Correct Answer
A) She had to disclose the conditions she actually observed, even though she is not an inspector
The disclosure duty attaches to what the licensee knows, and an adverse condition she has seen or smelled is knowledge regardless of her lack of technical training. She is not required to diagnose the cause, quantify the damage or certify that a defect exists; she is required to tell buyers what she observed so they can investigate. Staying silent because the observation was unconfirmed converts a disclosable fact into a concealed one.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The fiduciary obligations owed by a listing agent to the seller, including marketing the property, presenting all offers, and protecting the seller's confidential information.
A practice where the agent or brokerage represents only one party in a transaction — either the buyer or the seller, but never both.
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.
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