Agency
A buyer's agent discovers during inspection that the subject property has a sinkhole risk. The agent should:
AKeep this information confidential to avoid alarming the buyer
BImmediately disclose this information to the buyer and advise them on their options✓ Correct
CPresent the information only after closing
DNegotiate a price reduction without telling the buyer why
Explanation
A buyer's agent must promptly disclose all material facts including significant risks like sinkholes. The buyer needs this information to make an informed decision about whether to proceed.
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Key Terms to Know
Buyer's Agent
A real estate licensee who represents the buyer's interests in a transaction, owing fiduciary duties to the buyer.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
AgencyA legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.
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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