The duty of disclosure in an agency relationship requires the agent to:
Why Inform the principal of all material facts relevant to the transaction Is Correct
Answer B: Inform the principal of all material facts relevant to the transaction
Exam Tip: Agency
Agency questions are among the most tested on the exam. Focus on the difference between client and customer, and memorize the fiduciary duties (OLD CAR). Watch for questions that try to blur the line between a general agent and a special agent.
Key Agency Terms in This Question
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Key Terms to Know
A legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Fiduciary DutyThe highest legal duty an agent owes to a principal — requiring the agent to act in the principal's best interest above all others.
Dual AgencyA situation where a single real estate agent or brokerage represents both the buyer and the seller in the same transaction.
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