Agency
In Minnesota, a seller's agent who learns the buyer's lender has denied financing should:
AKeep it confidential as it is the buyer's information
BImmediately inform the seller because it materially affects the transaction✓ Correct
COnly inform the seller if asked
DContact the buyer's agent first and wait for them to tell the seller
Explanation
When a listing agent learns that the buyer's financing has been denied, this is a material development that must be disclosed to the seller immediately. The seller needs this information to make decisions about extending the contract, requiring a new pre-approval, or relisting the property.
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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.
Pre-ApprovalA lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.
Listing AgreementA contract between a property owner and a real estate broker that authorizes the broker to market and sell the property.
AgencyA legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.
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