Contracts
An Iowa buyer's agent who submits an offer without disclosing a material defect known to the buyer is:
AFulfilling their duty of confidentiality to the buyer
BPotentially liable for fraud or misrepresentation, as licensees may not knowingly assist a party in concealing material facts✓ Correct
CProtected by the agency relationship from any liability
DRequired to disclose to the IREC only
Explanation
While a buyer's agent owes confidentiality to their client, Iowa law prohibits licensees from knowingly participating in fraudulent misrepresentation or active concealment of material facts. An agent cannot assist a buyer in defrauding a seller.
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Key Terms to Know
Agency
A legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.
Buyer's AgentA real estate licensee who represents the buyer's interests in a transaction, owing fiduciary duties to the buyer.
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Right of First RefusalA contractual right giving a party the opportunity to match any offer received before the owner can accept it from a third party.
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