Difficulty: Medium

Average Score: 50%

Seller Sadie lists her home 'as is.' What obligation does Sadie have?

Rationale

Seller Sadie is obligated to disclose known material facts to the buyer.

Even when a home is listed 'as is,' the seller must still disclose any known material defects to potential buyers. This obligation exists to protect buyers from unexpected issues that could affect the property's value or safety, regardless of the 'as is' condition.

A (Nothing; 'as is' means she is no longer obligated to disclose known material facts to the buyer.) YOUR ANSWER

This choice is incorrect because sellers cannot absolve themselves of the responsibility to disclose known material defects simply by listing the property 'as is.' Legal requirements generally mandate that sellers must inform buyers of any significant issues that could affect the property's value or safety.

B (to disclose known material facts to the buyer) CORRECT

This is the correct answer because sellers have a legal and ethical obligation to disclose any known issues with the property, even if they are selling it in its current condition without making repairs. This transparency is crucial for informed decision-making by buyers.

C (to add an inspection contingency for the buyer) YOUR ANSWER

While it is common for buyers to request an inspection contingency, the seller is not obligated to add one simply because the home is listed 'as is.' The inclusion of such contingencies is typically negotiated between the buyer and seller, and the seller's listing choice does not enforce this requirement.

D (to lower the purchase price since she's listing it 'as is') YOUR ANSWER

This choice is inaccurate as there is no requirement for the seller to lower the purchase price when listing 'as is.' Pricing is a strategic decision made by the seller and can reflect the property's condition, but it is not mandated by the 'as is' listing status.

Conclusion

Sellers are required by law to disclose known material facts to buyers, regardless of whether a property is sold 'as is.' Sadie retains this obligation to ensure buyers are fully informed about the property's condition. Misunderstanding this duty can lead to legal repercussions and undermine trust in the transaction process.

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