Through our understanding of the law, the Realtor Code of Ethics, and purchase agreement terms, we consistently protect our clients’ interests and deliver outstanding results. Here’s a real-life example, with details modified to maintain confidentiality:
Situation
During a post-acceptance visit to a house with the buyer-client, we observed a condition that met the definition of a defect, was not apparent prior to submitting the offer, and was not disclosed by the seller.
How we addressed the issue
Instead of initiating a phone discussion with the listing agent, we documented the evidence with photographs and submitted them, together with an amendment outlining a clear, buyer-approved resolution.
Why this the best practice
A written amendment to the offer, accompanied by photographs, clearly documents both the buyer’s knowledge and the specific resolution the buyer has authorized. The listing firm is required to present this amendment. This written approach ensures the seller knows exactly what the buyer is aware of and what terms are acceptable. The seller can then agree in writing to the precise actions the buyer expects to resolve the issue. By clearly outlining the seller’s obligations, the risk of misunderstandings is minimized. Notably, discussions between agents—while common—are non-binding on the buyer or seller and frequently lead to confusion or disputes.
The Listing Broker’s response
As is often the case, the proposed amendment and supporting photographs prompted a swift reaction from the listing agent, who claimed the seller would not accept the amendment. It was unclear whether the amendment had actually been presented to the seller, though the conversation suggested otherwise. The listing agent argued that the seller was not obligated to address the condition because “the buyer had waived the opportunity to include an inspection contingency in the offer.” This assertion may have overstepped by offering a legal opinion without the proper qualifications.
What’s wrong with the listing agent’s defense?
Both the Real Estate Condition Report and the Wisconsin Residential Offer to Purchase make it clear that sellers must disclose any known material conditions before an offer is submitted, and remain responsible for disclosing issues that arise before acceptance. Sellers are also obligated to disclose and address conditions discovered after acceptance of an offer. The listing agent’s duty to disclose material conditions—whether observed before or after the property is listed—is unequivocal. If a seller withholds information about a known defect, both the listing agent and buyer agent are still required to disclose those conditions. Agents who fail to disclose material conditions risk facing a hearing before a panel of Realtors or the State Department of Licensing to defend their choice.
How we resolved the issue
Although the condition we identified met the definition of a defect, the buyer was prepared to proceed with closing even if the seller refused to correct it beforehand. Importantly, closing did not waive the buyer’s right to pursue a post-closing resolution, which could include compensation from the seller and/or the listing broker. By leaving the matter unresolved prior to closing, the seller and listing agent risked facing a post-closing claim, possibly involving demands for compensation, legal fees, or even a defense before an ethics or licensing board.
Initially, the listing agent attempted to deny responsibility and advocated solely for the seller. However, once the buyer’s options were clearly explained, the listing broker presented us with a seller-signed written amendment, offering the buyer a substantial financial credit, which the buyer accepted.
All of the parties benefited
I anticipate pushback when delivering bad news, so I always prepare for potential objections. In this situation, I expected the listing agent to argue that waiving the inspection contingency relieved the seller of responsibility. We proactively proposed an amendment that clearly stated the buyer’s request and offered the seller a straightforward solution they could immediately accept. When resistance arose during the phone call, I was ready to lay out the buyer’s options and make it clear that the buyer’s rights would remain intact even after closing. Although the listing agent was initially focused on defending his position, I believe he realized it was in his client’s best interest to resolve the matter before it escalated to legal action.
While the seller was not my client, the solution we crafted for our buyer also provided the seller with a way to minimize their risk, and give them another opportunity to disclose more of what they knew.
The buyer benefited by having the condition resolved in an acceptable manner.
The listing firm and agent benefited by ensuring the seller acknowledged and documented the previously undisclosed condition and limiting their further legal or ethical exposure.
My firm benefitted by having documented the condition, the fact that we provided options for resolution for the buyer, and the seller and the listing firm.In the end the sale closed on time which is what the buyer and seller desired.
Conclusion
Reacting with anger or avoidance only leads to conflict and missed opportunities. Success comes from understanding everyone’s obligations and rights, and from calmly seeking practical solutions that benefit all parties. With deep knowledge of legal and ethical standards, we focus on resolving issues rather than escalating them.
While we can’t always secure your desired price, we work smart to structure offers that keep you protected and satisfied with the outcome. Share your concerns about buying or selling a home, and I’ll show you the strategies I use to keep you safe—chances are, I’ve helped clients overcome similar challenges. When you know any challenge can be resolved, you’ll rest easier and negotiate wisely.