Agency
Under Iowa law, a seller's agent who discovers a material defect not disclosed by the seller has a duty to:
AKeep the information confidential as part of seller loyalty
BDisclose the material defect to the buyer✓ Correct
COnly disclose if the buyer specifically asks about that defect
DReport the defect to the IREC immediately
Explanation
While a seller's agent owes loyalty to the seller, they also owe honesty and disclosure of material facts to buyers. A licensee cannot conceal a known material defect that would affect a buyer's decision to purchase or the price they would pay.
People Also Study
Related Iowa Questions
- A buyer's agent in Iowa who discovers a material defect in the property during a showing must:Agency
- In Iowa, a seller who discovers their listing agent failed to disclose a material defect to a buyer may:Agency
- An Iowa buyer signs a purchase agreement but then discovers the home sits on a 100-year floodplain that was not disclosed. The buyer may be able to:Contracts
- Iowa's agency disclosure law requires the licensee to provide a written agency disclosure form to the consumer:Agency
- An agent's duty to disclose material facts applies to:Agency
- An Iowa licensee who engages in 'churning' (encouraging clients to buy and sell repeatedly to generate commissions) violates the fiduciary duty of:Iowa License Law
- An Iowa purchase agreement contains a financing contingency. If the buyer cannot obtain financing within the contingency period, the buyer:Contracts
- An Iowa purchase agreement includes a financing contingency. If the buyer cannot obtain financing, what is the likely outcome?Contracts
Key Terms to Know
Fiduciary Duty
The highest legal duty an agent owes to a principal — requiring the agent to act in the principal's best interest above all others.
Seller's Agent (Listing Agent)A real estate licensee who represents the seller's interests, markets the property, and owes fiduciary duties to the seller.
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.
Study This Topic
Practice More Iowa Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Iowa Quiz →