May 6, 2020
3 MINUTE READ
If you’re new to real estate transactions or in position to buy a house, the disclosure process may be full of unknowns. Seller’s disclosures are an extremely important part of any deal since they reveal the complete history of a property. The disclosure documents consist of various questions answered by the seller that provide potential home buyers with key insights into the property’s details.
While disclosures mainly function to provide buyers with information on the property’s past and current condition, it also protects the seller against future litigations. With so much on the line, sellers need to ensure they’re properly completing the documents without any errors. On the other hand, potential home buyers need to understand exactly what they’re buying so it’s always a good idea to consult with a real estate agent for help.
Wether you’re in the market to buy a home or simply exploring the idea of buying a home, here are some things to know about disclosures.
Seller’s disclosure is a set of documents that communicate any defects, issues, problems, or construction done on the house. The document also mentions all the upgrades and renovations that have improved the property in the past. This gives home buyers a clear look at a property’s history, highlighting both the positives and negatives. When used in conjunction with home inspection reports, disclosures can provide potential home buyers the framework to make informed decisions on whether or not to buy a house.
While some sellers think that this disclosure only benefits the buyer, it stands as a key element in establishing a seller’s security. Since both buyers and sellers are required to review and approve a deal’s disclosure form, the buyer is unable to take legal action against the seller if anything goes wrong in the future. If there’s an issue that is not mentioned in the seller’s disclosure, the buyer can go after the seller for the problem’s impact on your property.
To ensure their security moving forward, sellers need to be sure they’re accurately and completely filling out the disclosure.
The general purpose and format of seller’s disclosures are the same around the country – however, disclosure requirements for each state can vary. The details are dependent upon local requirements, and the only thing that the US Federal Government requires is information concerning asbestos exposure and lead-based paints.
You can expect to find detailed records of property defects, past problems, current conditions, as well as construction done on major areas and systems. The seller’s disclosure mainly focuses on anything that may pose a danger to public health, safety, and general wellbeing. They will also contain aspects that can potentially cause your property to decline in value over time, so home buyers need to keep a keen eye when reviewing this document.
Leaks, renovations performed without a permit, utility problems, environmental hazards, bankruptcy cases, crimes, neighborhood issues, or existing property liens are common elements that will be highlighted within the seller’s disclosure.
Since a seller is responsible for disclosing these various property elements, they need to perform due diligence on their listed property. Sellers who neglect to include information on the disclosure that they’re unaware of can be at risk for legal pursuit down the line. Even if an item has been fixed, it’s still imperative for sellers to disclose anything they’re aware of. In the case that any problems do arise from pre-existing conditions that weren’t included in the disclosure, the seller could be held legally responsible.
A seller’s disclosure is a key document for both parties involved in any real estate transaction. Both buyers and sellers greatly benefit from the information shared through it, and it can make the world of a difference in a property’s negotiation, purchase, and future.
At Reali, we offer honest and transparent real estate service, with experienced local agents, big savings, and zero pressure.