Question

Agent Thurmond has a listing that is in a flood hazard area that floods often and has been deemed ineligible for flood insurance.That condition would make the property ineligible for typical federally-related first mortgage financing. Agent Thurmond is representing only the seller in this transaction. Agent Thurmond has received an offer from a potential buyer that plans to pay cash and would not be required to have flood insurance because he is not getting a mortgage. Agent Thurmond must:

Answer 1

Answer: disclose the material fact about the flood hazard to the buyer.

Explanation:

Based on the information given in the question, Agent Thurmond must disclose the material fact about the flood hazard to the buyer.

It is advisable and ethical for Agent Thurmond to tell the buyer about the issue with regards to the flooding. This is appropriate in order to avert any controversy or case that may eventually result in the future when the buyer becomes aware of the flood hazard.