Are you aware of all Real Estate disclosures for both buyer and seller? Our advice: be as honest as possible. In this blog post, we will discuss what you need to disclose according to the law.
Being transparent and honest will not only help you avoid a lawsuit, but is the right thing to do as well! If you try to hide things, omit needed repairs and any other issues with the home, all of this will come with a bitter taste at the end! No one wants a lawsuit!
Most real estate lawsuits occur because of non-disclosure!
So what does the law says you’re required to disclose legally? The answer is simple and straightforward: anything that can affect the value of the property.
Here’s a few examples you should address:
So exactly how much are you required to disclose legally? Basically, anything that can affect the value of the property. Here are just a few of the things you should address:
- Any know problems with the land, such as bad soil, contamination, potential for flooding, drainage issues.
- Cracks or issues with foundation level must be disclosed. If there are issues with the foundation, the house could experience structural damage.
- Plumbing and sewer issues, as well as leaky pipes all must be disclosed. Some of the most expensive repairs a house can have comes from water damage.
- Any problems or issues with HVAC should be disclosed.
- Insects, rodents, or other any animal issues should be informed to the potential buyer.
- Is the roof in good condition? If you are aware of any leaks or issue with the roof, they should be disclosed before the buyer knows it the bad way (during a storm).
- Lead paint, mold, asbestos or any other harmful contamination must be disclosed as well. This is one of the most common disclosures.
- Lead paint is a no-brainer. This disclosure is one of the most common you will see with home sales and rentals.
- Are there any known issues with the deed? Any restrictions that will affect the title? Or rightful ownership? This needs to be spelled out up front, not during the closing process.
- You should also have documentation for repairs and insurance claims you’ve made in the past. You should be able to describe what was done and the materials used.
In addition, other states may require different disclosures like earthquakes, hazard zones, violent crimes committed in the home and a lot of other stuff. Always check your state law before making any decision. Think about what YOU would like to know if you were the buyer!
Disclosures help the buyer to know more about the property they’re about to purchase
When you don’t disclose any known issues or needed repairs, it can become a much bigger issue. A lot of this things will usually come up during an inspection anyway, so it’s better to be honest with the buyer and when that same issue shows up on the inspection report, you will be in a much better position to negotiate any needed terms or adjustments to the contract. Your asking price could be slashed because of something you didn’t disclose and showed up during an inspection. If necessary, you can have an inspection before listing the house to sell. That way, you can take care of all needed repairs before selling.
Disclosure rules vary state to state. Your agent, attorney or broker will be able to supply you a checklist that covers the requirements for your state. Review the list in its entirety and add as many detailed notes as possible. Don’t forget to include the dates of upgrades and repairs. Fill out the form as honestly and as completely as possible. If you have questions, it is best to talk to a lawyer instead of your agent. Your agent might avoid such questions as they are out of their scope, and they want to lessen their liability.
Remember, YOU CAN GET SUED for being dishonest.
And if you are found liable, you will need to pay for repairs, legal expenses, punitive damages and in some cases, the sale can be rescinded. Make sure you are working with a trusted professional to help guide you through real estate disclosures.
Are you selling your home in New Jersey? If you have questions, we have answers! Fill out this form, or give our office a call now! 1-888-WE-BUY-NJ