hard · National Real Estate Exam
A buyer's agent, acting under an exclusive buyer-representation agreement, learns from a third party that the listing seller is going through a divorce and is under pressure to sell quickly and quietly. The seller has not authorized disclosure of this fact. Using this information, the buyer's agent advises the buyer to submit a low offer.
Which statement best characterizes the buyer's agent's duty and conduct?
- The agent breached a duty to the seller because an agent may never exploit a counterparty's personal hardship in negotiations
- The agent acted properly: the duty of confidentiality runs to the agent's own principal, and using lawfully obtained information about the other side to advance the client's bargaining position is consistent with loyalty to the buyer
- The agent breached the duty of honest dealing owed to all parties by concealing from the seller that the agent knew of the divorce
- The agent must disclose the divorce information to the seller's agent under the duty of disclosure that every licensee owes to a transaction
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