PSI Virginia Real Estate Practice Exam

What kind of defects must sellers declare?

1. Only those disclosed in previous listings

2. Only defects that can be seen during open houses

3. All known material defects

4. Only structural issues

The correct answer is: All known material defects

Sellers are required to declare all known material defects, which is the correct answer. A material defect is typically defined as a condition that could significantly affect the value of the property, its structural integrity, or the health and safety of its occupants. This obligation is rooted in the principles of full disclosure and ethical responsibility in real estate transactions. It is crucial for sellers to be transparent about any issues that could impact a buyer's decision or the property’s worth. This includes, but is not limited to, defects related to plumbing, roofing, electrical systems, pest infestations, or environmental hazards. By declaring these defects, sellers protect themselves from potential legal ramifications that might arise if a buyer later discovers undisclosed problems. The other options present limitations that do not align with the legal requirements of seller disclosure. For instance, the notion that only defects disclosed in previous listings are relevant ignores a seller's duty to disclose current known issues regardless of past representations. Claiming that only visible defects during open houses require disclosure fails to acknowledge that many defects may not be apparent without thorough inspection. Lastly, focusing solely on structural issues excludes other types of material defects that could have serious implications for a buyer, thereby not fulfilling the seller’s responsibility under state laws.