Purchasing a home can be nerve-racking as you are spending your life’s savings. That’s why a strong seller disclosure can be your superhero sidekick. You can think of it as a snapshot of the actual condition of your place and how it might allow you to avoid surprises.
Consider the example of a California family that discovered, after occupying the house, that it had water damage due to past flooding, which the seller had not disclosed. An avoidable legal battle ensued. This perfectly illustrates why a complete seller disclosure is a must-have shield for both buyers and sellers.
In this blog, we look at the 8 most crucial seller disclosures every buyer should know.
8 Seller Disclosures Every Buyer Should Know
Here’s a list of 8 disclosures that will help you make a safer and smoother home-buying decision.
1. Structural & Mechanical Issues
The first one is always crucial. Sellers must disclose any noticeable cracks, foundation problems, issues with heating, ventilation, air conditioning, plumbing, or electrical problems. Openness in these aspects will save you surprises later. Statistics indicate that nearly one in five buyers have complained of undisclosed issues, which they consider questionable.
2. Environmental Hazards
Things such as lead paint (found in houses constructed before 1978), asbestos, radon, or mold carry serious health concerns. The federal law has disclosure requirements for lead paint, and sellers are then required to document and provide a 10-day testing period to buyers.
3. Renovations and Past Repairs
Did you install new plumbing pipes? Was the roof patched? The sellers must disclose what has been fixed and how it was fixed. This can assist you in budgeting and assessing the actual condition of your house.
4. Natural Hazards & Location Risks
Is the house located in a flood zone or near a fault line? In states such as California, such disclosures (hazards of earthquakes) are required; in Florida, there is disclosure related to coastal issues.
5. Legal & Title-issues
Verify if there are any boundary problems, liens, or illicit work done to the house. They may be hard to fix later. The disclosures can include the presence of easements or pending legal judgments.
6. The Details of the Home Owners Association (HOA)
Any fees or rules of the HOA, as well as any litigation, must be included on the agenda. It may also have an impact on how you borrow or remodel your new house.
7. Neighborhood Nuisances or Previous Deaths
The sellers are required to disclose any repetitive disturbances or unusual neighborhood history. The state of California, for example, requires the disclosure of deaths on the premises within the last three years, whereas other states do not.
In Texas, for example, there is no need to report natural death or unrelated accidental death, but violent crime or fatalities related to the property must be disclosed.
8. Paranormal Activity (Yeah, Right!)
There are only a few states, including New York, New Jersey, and Minnesota, that mandate the disclosure of hauntings. New Jersey goes as far as to require it when asked. The majority of states are not obliged to report on paranormal activities.
Why Seller Disclosures Matter
These seller disclosures make sense; they encourage us to be more transparent in our everyday dealings and engender trust amongst us. It reminds us that the world is not such a bad place to live, after all.
Here are some of its other benefits.
Smarter Negotiations
Disclosures put you in an advantageous position, whether it’s requesting repairs, negotiating prices, or even walking away when the repairs are too costly or too complex. According to a report, the likelihood that 20%-30% of buyers renegotiate terms after the disclosure is very high.
No More Legal Troubles
Failure to disclose or misrepresentation of defects allows buyers to rescind the sale or sue the seller. Around 77% of real estate litigation is based on disclosure issues. Putting the words “as-is” cannot absolve sellers of their responsibility to disclose the actual flaws they know.
Builds Trust, Quickens the Deal
Home disclosures help sell quicker. It presents honesty and minimizes the risk of buyers pulling out halfway through the deal. Disclosures should be made before receiving offers to facilitate easier closures. Full disclosure increases the level of trust, and 97% customers prefer honesty in their dealers.
Putting it All Together
When buying a home, use the seller’s disclosure as your guide. It serves as your early warning system, helping you see what you are really buying, what to bargain for, and what risks to expect. However, even a full disclosure is not a warranty; as a buyer, you still need a proper home inspection.
The As-Is Fallacy: An Example
A recent Kiplinger case described a homeowner who included a warning in a listing for his house: the home was being sold ‘as-is,’ rather than taking legal responsibility for disclosing any real issues. They got into legal trouble. The sellers cannot run away from their responsibilities under the garb of ‘ sold as is’.
Conclusion
A solid seller disclosure is more than a checklist; it’s your protection, your negotiation tool, and your peace of mind. Acting as your own guide, as you approach your dream home, think of these eight types of disclosures and discuss them with your agent or real estate lawyer.
If you need to review your seller disclosure or understand inspection details, please reach out to Elite Inspections. Your home buying process with our experienced home inspection team is more confident. Through our extensive experience and candid evaluation, we provide you with more than just a house to buy; we guarantee a wise investment. Call Elite Inspections today and learn more and better, before moving into your new home.
