Texas Crammer Practice Exam

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What legal action might a buyer take if a seller deliberately withholds information about property defects?

File a lawsuit for damages
Demand an automatic refund
Request mediation
Contact regulatory authorities

The correct answer is: File a lawsuit for damages

A buyer may choose to file a lawsuit for damages against a seller who deliberately withholds information about property defects because this action constitutes misrepresentation or fraud. When a seller knowingly hides defects, they may violate disclosure laws or the principle of good faith and fair dealing expected in real estate transactions. By filing a lawsuit, the buyer seeks compensation for any financial losses incurred due to the seller's actions. The damages could cover the cost associated with repairs, decreased property value, or other related expenses that arose because of the undisclosed defects. This legal remedy allows the buyer to hold the seller accountable for their actions and can serve as a deterrent against similar behavior in the future. While requesting mediation and contacting regulatory authorities can be beneficial in some situations, these actions may not lead directly to financial compensation for the buyer. Demanding an automatic refund is also not a typical legal recourse since refunds depend on specific contractual terms and conditions that must be examined within the context of the agreement between the buyer and seller.