Practice and Disclosures, 25% of the examination
Material fact
A fact that would affect a reasonable buyer's decision to buy or the price they would pay.
Known material facts affecting value or desirability must be disclosed even when the buyer is not the agent's client. California's death statute is narrower than the common shortcut: it bars liability for failing to disclose a death more than three years before an offer. It does not make every death within three years automatically material. A direct question must be answered truthfully, subject to the separate rule protecting HIV and AIDS information.
See also
Test the distinction
A relevant question from Practice and Disclosures, selected because its facts or explanation use this concept.
An agent discovers a cracked foundation during the visual inspection. The seller instructs the agent not to mention it. What must the agent do?
Written to DRE's published topic list. Not a real examination question, since reproducing those is a misdemeanor under B&P Code section 123.
Primary sources
Use these authorities when a course summary, forum answer, or older flashcard conflicts with the current California rule.