If a licensee learns about undisclosed foundation problems from a seller's neighbor, what must they do?

When a licensee learns about undisclosed foundation problems, it is crucial to disclose this potential issue to the buyer. This obligation stems from the legal and ethical standards set for real estate professionals, which prioritize transparency and the duty to inform clients of material facts that could influence their purchasing decisions. Foundation issues can significantly affect the property's value, safety, and overall integrity, making it imperative for the licensee to proactively share this information with the buyer rather than waiting for inquiries.

Informing clients only if asked does not fulfill the licensee's duty to disclose material facts. Merely ignoring the information could result in legal repercussions, as it would be considered withholding significant information that could impact the buyer's choices. Consulting with a home inspector is a valuable step in assessing the condition of the property but does not replace the responsibility of disclosing any known issues. Therefore, the most appropriate action for the licensee is to provide full disclosure regarding the foundation problems to the buyer to ensure informed decision-making.