A listing agent knows all of the following about a property she has listed. Which one is a material fact she must disclose to prospective buyers?
Correct Answer
B) A foundation crack a past remodel hid beneath new flooring
A material fact is information about the property or the transaction that would affect a reasonable buyer's decision or the price, and a known physical defect that ordinary inspection cannot reveal is the clearest example of one. The seller's bottom line and her reason for moving are confidential client information the agent must protect rather than volunteer. Enthusiastic praise for a kitchen is sales talk with nothing verifiable in it, so no disclosure duty attaches to it.
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Related Topics & Key Terms
Key Terms:
Related Concepts
An agency relationship where the agent agrees to act on behalf of the principal without receiving compensation.
An agency relationship created by the conduct or actions of the parties rather than by a written or oral agreement.
The legal obligation to reveal information that could affect a party's decision to enter into or the terms of a real estate transaction.
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