Sellers' Disclosure - Know the Law
Disclosure laws are becoming more and more strict, and sellers now have a much greater obligation to disclose material facts that can affect the value/sale of their home.
What is a "material fact"? It is anything that could affect the sale price or exert influence on a buyer's decision to purchase a home. States are increasingly tightening up laws on the sellers' obligation to disclose known conditions not readily apparent, such as a cracked foundation.
- State laws
- Most states require some form of seller disclosure. The form of disclosure can vary. Some states require a seller to complete a questionnaire about their property's condition; in other states, disclosures can be made verbally. In some states, seller disclosures are voluntary. The only sellers excluded from disclosure laws are banks and mortgage companies selling foreclosure properties.
- Federal and local laws
- In addition to state mandates, some local and federal laws require sellers to make specific disclosures. Federal law, for example, requires sellers of homes built before 1978 to disclose any known lead hazards (lead paint).
- Real estate company requirements
- Some major real estate companies require prospective sellers to complete a disclosure form before listing their property.
A fact that is material to one buyer may be of no concern to another. If you're in doubt as to whether a condition should be disclosed, consult your real estate agent or a property attorney. And ask yourself if you'd want to know this information if you were the buyer. If the answer's yes, then disclose.
- Toxic Hazards
- Structural defects are one thing; health risks from exposure to toxic chemicals are another issue altogether. Homebuyers are becoming increasingly concerned about environmental hazards and toxic materials in houses, especially in older homes. Common toxic substances include lead paint, lead pipes,asbestos insulation, asbestos ceilings, formaldehyde insulation and glues, and carbon monoxide or radon gases. Have your home tested for these substances. More buyers are requesting such tests, and may expect you, the seller, to correct the problem or offer a lower price to cover the cost of removing toxic substances.
Tip: Defects as Deal Breakers
Homebuyers many times back out of real estate deals when the home inspection reveals a problem. To avoid the potential for failed deals and the inevitability of having to disclose a newly found defect, have your property inspected before you put it on the market
...Coming Soon - Murder, Mayhem and Things That Go Bump in the Night - "Stigmatized Property"