medium · National Real Estate Exam Contracts
A buyer signs a purchase agreement for a residential property that includes an 'as-is' clause. During the inspection, the buyer discovers a large, visible hole in the living room wall.
Under the principle of 'as-is' sales, the seller is generally:
- Required to fix the hole because 'as-is' only applies to the mechanical systems of the house.
- Liable for damages because an 'as-is' clause is only valid for commercial real estate transactions.
- Not required to repair the hole, as it is a patent defect that was discoverable by the buyer.
- Automatically in breach of the covenant of seisin by selling a damaged property.
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