A listing agent touring a home before drafting marketing materials sees water stains on the basement ceiling, peeling paint around a window frame, and a soft, depressed area in the floor near the bathroom. The seller has never mentioned any of these conditions. The agent writes each one down so that prospective buyers will be told about them. Which obligation is she carrying out?
Correct Answer
D) The duty to disclose known material defects
A licensee must disclose material facts about the property's condition that she knows, and conditions she has personally seen are knowledge she cannot set aside. Water intrusion, a soft floor and failing paint all bear on value and desirability, so a buyer is entitled to learn of them whether or not the seller raises them. Recording what she observed so it can be passed on is the disclosure duty in action, and it runs to the buyer even though her client is the seller.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The legal requirement for real estate agents to inform all parties about who they represent in a transaction, typically provided at first substantive contact.
A legal relationship in which one person (the agent) is authorized to act on behalf of another person (the principal) in business transactions with third parties.
The legal ending of an agency relationship, which can occur through completion, expiration, mutual agreement, breach, death, incapacity, or bankruptcy of either party.
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