Agency
A Minnesota buyer's agent discovers during a showing that the seller has patched over water damage in the basement without disclosing it. The agent should:
ASay nothing to protect the seller's privacy
BDisclose the observation to the buyer as a potential material fact✓ Correct
CReport the seller to the police for fraud
DAsk the seller's agent to disclose it and wait
Explanation
A Minnesota buyer's agent must disclose observations of potential material defects to their client. Patched water damage could indicate ongoing moisture problems.
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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.
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
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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