7.16 Disclosure of Material Facts

The Company policy is to disclose all materials facts at all times. Associates must instruct their principals to do the same.

State real estate licensing law provides that a real estate agent may be disciplined for making any willful or negligent misrepresentation or any willful or negligent omission of material fact.

Examples of material facts include, but are not limited to, facts about the property itself (such as a structural defect or defective mechanical systems); facts relating directly to the property (such as a pending zoning change or planned highway construction in the immediate vicinity); and facts relating directly to the ability of the agent’s principal to complete the transaction (such as a pending foreclosure sale).

No matter whom the agent represents, these facts must be disclosed to both the agent’s principal and to third parties the agent deals with on the principal’s behalf. In addition, an agent has a duty to disclose to his principal any information that may affect the principal’s rights and interests or influence the principal’s decision in the transaction.

Under State Laws, the seller of real property, or the agent for the seller, must disclose accurate information of material fact telling whether historical evidence indicates that an event of natural origin is likely to affect the desirability and value of the property, even if the property is listed "as is.”