Humber/Ontario Real Estate Course 3 Exam Practice

For a known latent defect in a property:

1. Disclosure is unnecessary if the defect is visible to viewers.

2. It must be disclosed to avoid legal issues post-sale.

3. Only the seller is impacted by nondisclosure.

4. It does not need to be disclosed to protect the seller's interests.

5. The buyer must discover it themselves.

6. The home inspector's report will suffice.

The correct answer is: It must be disclosed to avoid legal issues post-sale.

The requirement to disclose a known latent defect in a property is essential to ensure transparency and protect all parties involved in a real estate transaction. A latent defect, by definition, is a problem that is not immediately visible and may not be discoverable through reasonable inspection. When a seller or their agent is aware of such a defect, failing to disclose it can lead to significant legal repercussions, including potential lawsuits for misrepresentation or fraud. Disclosing known latent defects demonstrates good faith and fairness in the transaction. It allows the buyer to make an informed decision regarding the property, which aligns with the principle of full disclosure in real estate dealings. Additionally, should any disputes arise after the sale regarding the defect, the seller is more likely to incur legal issues if the defect was not disclosed. By communicating the defect beforehand, sellers can mitigate the risk of future legal complications. The other options suggest various misconceptions about disclosure obligations in real estate transactions. Whether or not a defect is visible does not negate the responsibility to disclose known issues, particularly those that may minimize the value of the property or affect a buyer's decision. Each party involved in the transaction, not just the seller, is affected by nondisclosure, as it can lead to a loss of trust, potential litigation,