Home Disclosures: What Does a Seller Have to Reveal?

If you’re making an offer on a house, one of the first things you’ll get as far as documentation is a property disclosure. Also known as property disclosure statements, real estate disclosure forms, or home disclosures. The specifics vary by state, but most states require some type of seller disclosure. The goal is to add transparency to the transaction process.In a disclosure, a seller provides written information about known things that could impact the property’s value, like termite damage or a leaky roof. The disclosure will also include details like the homeowners’ association fees and restrictions.These documents are meant to provide buyers with a comprehensive overview of the property before buying it.On the seller’s side, the disclosure has the benefit of helping them avoid a future lawsuit if a new owner discovers hidden information. It is important as a buyer to understand these factors, and our team will be able to help guide you through them with ease.

The Basics

A seller typically fills out a standard disclosure form with yes or no questions about their property. The form will also have space for more details and explanations.
Some states have multiple versions of a disclosure form that comply with state law.
A real estate agent should fully understand the legal requirements for disclosures. If you’re a seller, your listing agent will provide you with the right documents that you fill out. Your agent should help you go through the completed forms if you’re a buyer.
The disclosure isn’t a replacement for a home inspection, but it might bring to light issues that you have an inspector take a closer look at.
Disclosures only require sellers to share the issues with the house that they’re aware of. There’s still the potential for hidden problems.
A purchase offer will have a deadline for sellers to provide disclosures and details on the number of days a buyer has to review them.
Then, the offer should also have details on the buyer’s right to change their mind or back out based on the disclosures.


What’s in the Disclosure?

Seller’s disclosure requirements, as mentioned, vary depending on your state. Some of the common issues they often include are:

Leaks or roof problems
Previous flooding or water leaks in the basement
Foundation cracks or defects
Issues with the air conditioning, heating, or plumbing systems
Defects in doors, floors, walls, or windows
Sewer or septic system problems
Infestations by wood-destroying insects or damage
Unsafe conditions related to lead, asbestos, or radon
Boundary disputes


Federal Requirements

Under federal law, if you’re selling a home built before 1978, you have to disclose that paint may be lead-based. 1978 is the year lead-based paint was banned for consumer use.
A seller of a home built before 1978 would also have to give buyers an EPA pamphlet about protecting their family from lead in the house and give buyers ten days to do a paint inspection or risk assessment for lead-based paint.


What to Look for in Home Disclosures:

If you’re a buyer, you may feel a little overwhelmed by the seller’s disclosure, and again, this is where a good agent can help you. If you aren’t sure about anything, don’t be afraid to ask.
One issue to watch for is mold or water damage.
Termite damage is another red flag. If termites aren’t taken care of, they can significantly impact a home’s structure, and a homeowner’s policy often won’t cover this damage.
Some states require that sellers identify if their property is part of a FEMA-designated floodplain. If this isn’t required in your state, you should look into it independently.


What Does Caveat Emptor Mean?

Finally, caveat emptor is Latin for “let the buyer beware.” In real estate, this means that it’s up to the buyer to be fully aware of any issues with the home.
If the disclosure laws in your state don’t require the seller to mention something, you have to figure it out on your own.
The only times you would have recourse as a buyer is if the seller intentionally sought to defraud you.
In general, it’s up to buyers to have a home inspected and follow up on issues before the transaction goes through.
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Rachel Sartin

Lori Corken