A Latent Defect is one that is not discoverable by an ordinary inspection. A common example is exterior insulation finish system (EIFS) which is a type of stucco finish that has been linked to water damage in leakage.
If there is a defect in said stucco, the buyers are within their right to withdraw or adjust their offer, baring that it was not disclosed.
Thats why Realtors should motivate their sellers to disclose the possibility of this damage to potential buyers in order to fully protect each party.
An interesting way to discover latent defects is to check reports for the property to see if an insurance claim had been filed within the last 3-5 years.
Conversely, Buyers agents are encourage to disclose any information to the otherside about the buyers ability to close under the circumstances of discovery of specific defects.
I hope this was helpful and have a great Sunday everyone!
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