Agency
In Massachusetts, a seller's agent discovers during marketing that the basement occasionally floods. The seller denied any water issues on the disclosure form. The agent must:
AAccept the seller's word—the seller knows the property better
BAdvise the seller to correct the disclosure and disclose the flooding to prospective buyers✓ Correct
CDisclose only to buyers who specifically ask about the basement
DReport the seller to the Board of Registration
Explanation
Known material defects must be disclosed. The agent must advise the seller to correct the disclosure statement and disclose the flooding to prospective buyers.
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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.
Dual AgencyA situation where a single real estate agent or brokerage represents both the buyer and the seller in the same transaction.
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.
Listing AgreementA contract between a property owner and a real estate broker that authorizes the broker to market and sell the property.
State-Specific Concepts
Disclosure Requirements
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