Humber/Ontario Real Estate Course 1 Exam Practice

If a salesperson is aware of a basement water leakage defect in a listed home, what is their duty?

1. Disclose the defect to a buyer client only.

2. Disclose the defect to a buyer customer and a buyer client.

3. No disclosure is necessary.

4. Disclose only under specific circumstances of significant leakage.

5. Inform the seller but not the buyer.

6. Publish the defect publicly.

The correct answer is: Disclose the defect to a buyer customer and a buyer client.

In this scenario, the correct answer is to disclose the basement water leakage defect to both the buyer customer and the buyer client. This is because as a real estate salesperson, transparency and honesty are crucial in dealing with clients and customers. By disclosing the defect to both parties, the salesperson ensures that all relevant information is shared, allowing the buyers to make an informed decision about the property. This practice aligns with the ethical standards and legal obligations in real estate transactions, promoting fairness and integrity in the process. Option A is incorrect as it suggests that the defect should only be disclosed to the buyer client, excluding the buyer customer from important information. Option C is incorrect because in real estate transactions, disclosure of known defects is typically required by law. Option D is not the best choice as waiting for significant leakage before disclosing may not align with the duty of the salesperson to provide accurate and timely information. Option E is misleading as withholding information from the buyer is not ethical or legal. Option F is also incorrect as publicly publishing the defect goes beyond the necessary disclosure to parties involved in the transaction.