Buyer agent Chen negotiates a purchase for Buyer Lopez. After the contract is signed, Chen discovers that the property is in a flood zone but this information was not discussed during negotiations. Neither the seller nor the listing agent mentioned it. Under Texas law, is Chen liable?
Correct Answer
B) Yes, if flood zone status is something a reasonably competent agent should have discovered during due diligence
Under the duty of reasonable care and diligence, a buyer's agent should investigate material property characteristics including flood zone status. Flood zone information is readily available from FEMA and county records. A reasonably competent agent should have checked this as part of due diligence.
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Related Topics & Key Terms
Key Terms:
Related Concepts
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.
The extent of power and actions an agent is authorized to perform on behalf of the principal, as defined by the agency agreement.
More Texas Agency Law Questions
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Agent Parker provides the IABS to Buyer Harris at the first showing. Later, Harris signs a buyer representation agreement with a completely different brokerage firm. When Harris contacts Parker about another property, Parker's firm still has a listing on, must Parker provide the IABS again?
In Texas, a sales agent who is assigned by the intermediary broker to communicate with and carry out instructions of one party in a transaction is known as a(n):
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