Broker N listed a home for sale wherein the seller stated that the existing loan was assumable by the buyer. Broker N relayed this information to prespective buyers; and, in time a sales contract was executed. However, the lender refused to allow the assumption to take place. As a result of this, the.........

Fill in the rest ( Hint: it has something to do with either the buyer, seller or the broker)

Will post the correct response in 12 hours

Answer: The Buyer can rescind the sales contract because the broker statement to the purchaser constituted innocent misrepresentation, and the contract would be voidable by the purchaser only. Fraud was not present, and the broker would not be subject to license revocation.

Shouldn't "Broker N" have done its diligence to verify that the loan was assumable before advertising it? Although I personally think this is more "laziness" than "innocent misrepresentation", I can understand how it is not considered fraud. Thanks for the enlightenment!