Alabama License LawIntermediateAlabama Exam
Which of the following is an example of a material fact that must be disclosed in Alabama real estate transactions?
AThat the seller is going through a divorce
BA leaking roof that the seller knows aboutCorrect
CThe seller's bottom line price
DThat the neighbors have dogs
Why A leaking roof that the seller knows about Is Correct
Answer B: A leaking roof that the seller knows about
Material facts are facts that would affect a buyer's decision to purchase or the price they would pay. A known structural defect like a leaking roof is a material fact that must be disclosed.
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Key Terms to Know
Option Contract
A contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Closing CostsFees and expenses paid by the buyer and/or seller at the closing of a real estate transaction, in addition to the property's purchase price.
State-Specific Concepts
License Law
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