Illinois Leasing Agent Practice Exam

The Residential Disclosure Act applies to what type of sellers?

1. Sellers of any residential property

2. Sellers of four units or less

3. Sellers of commercial property

4. Sellers of single-family homes

The correct answer is: Sellers of four units or less

The Residential Disclosure Act specifically aims to inform potential buyers about the condition of residential properties and the obligations of sellers regarding the disclosure of material defects. This law applies to sellers of residential properties with four units or fewer, making it essential for those selling single-family homes, condominiums, and small multi-family units to comply with disclosure requirements. The rationale behind focusing on smaller residential properties is to protect buyers by ensuring they have access to vital information about the property’s condition, which is particularly significant given that first-time home buyers and smaller landlords are often less equipped to conduct extensive due diligence compared to those dealing with larger commercial properties. Therefore, sellers of four units or less are mandated to provide specific disclosures regarding the property's physical condition to promote transparency and fairness in real estate transactions within this category. This focus helps to maintain a standard of accountability and fortify consumer protection in the residential real estate market.