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National curriculum lesson 96 · Disclosures

Seller Property Disclosure

Seller property disclosure rules vary by state, but a seller and licensee cannot lawfully use a form to commit fraud or conceal a known material defect. A disclosure form reports known conditions and is not a warranty, inspection, or substitute for buyer due diligence. Federal law separately requires specified lead-based-paint disclosures for most pre-1978 housing before the buyer is obligated.

Facts checked against the current PSI Candidate Information Bulletin and GREC sources. Last reviewed August 2, 2026. Editorial standards.

What is the exam-ready answer?

Seller property disclosure rules vary by state, but a seller and licensee cannot lawfully use a form to commit fraud or conceal a known material defect. A disclosure form reports known conditions and is not a warranty, inspection, or substitute for buyer due diligence. Federal law separately requires specified lead-based-paint disclosures for most pre-1978 housing before the buyer is obligated.
Official syllabus mapping for Seller Property Disclosure
Roadmap lesson96 of 500
Official syllabus topicSeller Property Disclosure
Official PSI areaProperty Disclosures
Published area weight7% of the 100-question national portion
Exam portionNational salesperson portion
Source editionPSI Georgia Candidate Information Bulletin dated July 1, 2026
Last verifiedAugust 2, 2026

The Rule

PSI publishes the weight for the complete content area, not a fixed question count for this lesson. Learn the rule well enough to apply it when PSI changes names, numbers, or parties in a new scenario.

Complete lesson

Read each concept as part of one decision system. The exam often gives one accurate statement and three statements that belong to a nearby concept.

Known condition disclosure

The seller answers based on actual knowledge and the form's questions. A seller should not guess, omit a known material condition, or describe a repair more broadly than the evidence supports.

Licensee responsibilities

A licensee must disclose material adverse facts required by law, avoid false statements, present the seller's information accurately, and recommend qualified inspection where appropriate.

Form limits

A disclosure statement is not an engineering report, title search, survey, environmental assessment, or guarantee that no hidden defect exists.

Special disclosure regimes

Lead-based paint, flood, association, environmental, and other subjects can have separate federal, state, local, contract, or lender requirements.

Decision rule

Identify who knows the fact, whether it is material, which disclosure regime applies, and when delivery must occur.

Georgia-specific distinction

Georgia does not rely on one universal state-mandated residential seller disclosure form for every resale, but Georgia fraud principles, brokerage duties, contracts, and federal law still matter. A Georgia licensee cannot treat the absence of a universal form as permission to conceal known material adverse facts.

Worked example

Scenario. A seller knows the basement floods after heavy rain but checks 'no water intrusion' on a voluntary disclosure form.

Reason it through. The form does not shield a knowingly false material representation.

Answer. The condition and false answer create serious disclosure and misrepresentation risk and must be corrected before buyer reliance.

Common exam traps

  • Calling a disclosure a warranty
  • Assuming no universal form means no duty
  • Telling the seller to omit known defects
  • Using disclosure instead of inspection

Original practice questions with detailed explanations

These questions were written for instruction and mapped to the current outline. They are not copied from PSI or any live examination. Choose an answer before opening the explanation.

Question 1

Is a seller disclosure form a professional inspection?

  1. A. Yes
  2. B. No
  3. C. Only when notarized
  4. D. Only for new homes
Show answer and explanation →

Answer: B. No

The form reports knowledge and does not replace qualified inspections.

Question 2

Which federal subject has a specific precontract disclosure regime for most pre-1978 housing?

  1. A. Lead-based paint
  2. B. Termites
  3. C. Zoning
  4. D. Property taxes
Show answer and explanation →

Answer: A. Lead-based paint

Federal lead law requires information, disclosures, and an opportunity for evaluation for covered housing.

Question 3

Can a seller knowingly answer a material condition falsely because the form is voluntary?

  1. A. Yes
  2. B. No
  3. C. Only if sold as is
  4. D. Only if vacant
Show answer and explanation →

Answer: B. No

Voluntary use does not authorize fraud or material misrepresentation.

Mastery tracking

Mark this lesson mastered only when every statement is true.

  • State the direct answer and decision rule without notes.
  • Explain every core concept in plain English.
  • Solve the worked example after changing one important fact.
  • Identify the Georgia distinction before reading answer choices.
  • Answer all three questions correctly and reject every distractor.
  • Repeat the topic in mixed practice on a later day.

Recommended next lesson

Continue with Inspection and Survey Red Flags. Continue to roadmap lesson 97 and build on this decision rule.

Return to the Property Disclosures hub to see every official branch and the complete lesson sequence for this content area.

Seller Property Disclosure questions

Facts checked against the current PSI Candidate Information Bulletin and GREC sources. Last reviewed August 2, 2026. Editorial standards.

Is Seller Property Disclosure on the Georgia real estate exam?

Yes. It belongs to PSI's Property Disclosures content area, which is 7% of the 100-question national portion. PSI publishes content-area weights, not a guaranteed question count for this individual lesson.

What is the main rule for Seller Property Disclosure?

Identify who knows the fact, whether it is material, which disclosure regime applies, and when delivery must occur.

What Georgia-specific distinction should I remember?

Georgia does not rely on one universal state-mandated residential seller disclosure form for every resale, but Georgia fraud principles, brokerage duties, contracts, and federal law still matter. A Georgia licensee cannot treat the absence of a universal form as permission to conceal known material adverse facts.

How do I know I have mastered this lesson?

Explain the rule without notes, solve the worked example again with changed facts, answer all original questions correctly, explain every distractor, and repeat mixed practice on a later day.