A seller’s disclosure is an important document. This is also known as a home disclosure and is a form that home sellers fill out prior to placing their home on the market. The disclosure’s purpose is to let people know if the home needs any kind of repair work performed if there are hazards, and then to describe updates that may have been done.
For buyers, the benefit is that they can evaluate the home by going over the disclosure form and having a home inspection. Some people may opt not to inspect at all and to avoid certain properties based on the disclosure, too, if that disclosure shows too many defects.
What kinds of things are included in a seller disclosure?
A seller disclosure should contain a number of pieces of information such as:
- Any health hazards in the home, like asbestos, lead paint or radon
- Previous issues with the home’s systems or structure
- Any defects that impact the home’s electrical system
- Flood risks
- Environmental issues, like issues with neighbors
- Repair work that has been done on the home, such as replacing a joist or central air system
This disclosure form isn’t good or bad. It’s simply factual and needs to include full disclosure of any issues with the property that the seller can think of.
Do sellers have to be honest?
Yes, but remember that sellers can’t disclose what they don’t know about. So, sellers are required to be honest about any issues that they know about as well as any repairs that have been done. If a seller were to lie or try to cover up an issue, the problem could come out during a home inspection anyway. That could then lead to issues with the sale, since the buyer may question if the seller is honest.
If you sell a property and damage is later found, a buyer could potentially come back and pursue a lawsuit over the lack of disclosure. Before you sell, make sure you take the steps necessary to fully disclose anything wrong with the property, so that you minimize the risk of property litigation.