9 Facts About Disclosures When Selling Your Property
9 Facts About Disclosures When Selling Your Property
What To Disclose When Selling Your House
Are you planning to sell your home? In that case, you must understand the importance of home inspections so that you can disclose problems or fix them before selling the property. Disclosures are a crucial part of home selling, so be sure to have an understanding of this when selling your home. To avoid legal problems and other issues later on, see to it that you disclose required details regarding your home or to fix what's needed.
It is also crucial to disclose other issues that could create problems for the new homeowners to avoid facing liability issues in the future. Below, you'll find helpful details regarding issues need to disclose, and you'll also learn why disclosures are vital. See these 9 crucial facts about disclosure when selling your property.
1What Is Disclosure?
Perhaps you don't know what disclosure is, but you'll soon learn about it if you are planning to sell your home. Most states have rules about disclosure, and buyers also demand such. Disclosure is a list of any problems with the property for sale, and this can cause sellers to worry since some buyers do back out from their deals, once they see the list in the disclosure.
Common issues like cracks in the foundation, leaking roof, and other problems. Renegotiations often occur, once such problems are revealed; and it's possible that these factors may put you at a disadvantage during a deal, but not always. The best that you can do, in such cases, is to give the disclosure to the buyer as soon as he makes an offer so that this will no longer be an issue down the road.
2Issues That Should Be Disclosed
Let's say that you have already fixed the problems: cracks had been repainted, shingles had been replaced, and walls had been recovered. Perhaps, you have also temporarily repaired the clogged bathroom sink. The idea is to convince a buyer that the property is well-maintained and that it's in good condition.
Let's say that after the sale is closed, the buyers learn that the situation in their new home is quite bad, but it's already too late. These days, there are laws that protect buyers. This is because several lawsuits and similar complaints have been submitted to the Better Business Bureau or BBB.
3Detrimental Effects Of Not Disclosing
Smart and experienced home sellers are aware of the fact that they can be held liable for issues that they fail to disclose. It's highly likely that they will still be required to pay for costly repairs, even after a sale has been closed. It's even possible for the court to demand that the seller take his home back and reimburse the buyer.
This result is unacceptable because naturally, you want to make the sale permanent and you don't want to continue shouldering the cost of repairs for your old house, right? Thus, you have to make sure that the sale is properly made, clean, and uncomplicated which means that you need to disclose problems regarding the property. Some individuals even recommend for sellers to reveal every issue, big or small, and you should even hire a qualified inspector to check for problems that you may not be aware of. All in all, the disclosure is a crucial aspect of selling a house.
4Formal Disclosure: A State Requirement
Most states require home sellers to submit a formal disclosure statement. Some states even have regulations regarding what issues should be included in the statement. If you hired a real estate agent, he should inform you about the specific requirements in your state when it comes to disclosures.
If you live in a state that does not provide guidelines regarding disclosures, be sure to make your disclosure statement for potential buyers with the help of your agent. This document will help in protecting you and your interests. It's better to inform a would-be buyer that the foundation is cracked, even if it means that he may back out; he may also go through with the sale knowing that information.
5Ignorance As A Defense Is Unacceptable
Providing disclosure statements is a legal requirement when selling a property. One should note that pleading ignorance of the law is an unacceptable excuse. As a seller, part of your responsibility is being aware of what needs to be done, and providing a disclosure is a crucial part of the selling process.
The main precedent for disclosures came from a certain lawsuit in California (Easton v. Strassburger, A010566, California First District Court of Appeal, February 1984). This lawsuit's rulings are now part of the law in California, and many are also included in the real estate codes of other states. The main focus of the California real estate code is on the agent's chief responsibilities.
6Home Selling Using An Agent
The entire world is a huge market, and buying and selling is a way of life. Sometimes, this is done through agents or representatives. In case you are selling your house through a real estate agent, this person will be responsible for many things including - properly informing a buyer about the real value and condition of the property, and conducting thorough home inspections to check every element of the property.
The same rules apply to homeowners who are doing the selling on their own. Homeowners must also be honest about the real value and condition of their property. In case you don't know how to assess common house problems, hire an experienced inspector.
7Who Shoulders The Inspection Fees Cost?
In general, the cost of a home inspection is shouldered by the buyer. A home inspection helps identify problems that a seller may not even be aware of. This includes structural issues or problems with the plumbing or electrical system.
Perhaps, you even noticed a faint gas odor in your home which you didn't think about; but this could be a serious problem as regards the entire property's gas system. Therefore, if you are a buyer, it is essential to conduct a thorough inspection of the property that you wish to purchase. Overall, inspections benefit both buyers and sellers.
8Benefits Of Home Inspections
For buyers, the major benefit of a thorough home inspection is that they will become aware beforehand about any problems, minor or major about the property that they want to buy. Home inspections will also help them in negotiating for a better or fair price. As for sellers, an inspection will provide them with a complete evaluation of their property, which likely includes obvious and even hidden problems.
Be aware that a seller is not immediately required to fix any problem that crops up. Nevertheless, these detrimental issues will have a significant effect on the sale. You can disclose all issues to a potential buyer, and he may still acquire the property as is. In such cases, you will no longer have to worry about paying for repairs.
9Other Disclosure Issues
Aside from problems regarding the condition of your property, there are still other issues that you need to disclose. To explain, you should also disclose the fact that your land is close to a landfill that sometimes produces a foul smell. You'll likely remain in good standing as long as you make sure that the would-be buyer understands the issue thoroughly, and that he is still willing to buy the property. The smell is not your fault, and you can't really do anything about it.
Compare this to the next scenario. Let's say that you found a defective electrical outlet during the inspection, and you did not fix it. Once the sale is settled and the buyer plugs something into that socket and gets electrocuted, you will still be held liable.
Disclosures are crucial in-home selling, and it benefits buyers and sellers alike. These documents will help in ensuring that you won't be saddled with financial responsibilities concerning repair or renovation problems, after closing a sale. Disclosures also make sure that the buyer won't sue you, or file complaints against you regarding safety hazards or nuisance issues, like the offensive smell from a nearby landfill that you conveniently "forgot" to mention. Therefore, you need to have your property inspected by an expert and then fix, or disclose all problems to avoid future issues. Hopefully, you'll be able to sell your house quickly!
Jackie Wing is an Alaska native, who enjoys snowboarding more than is probably socially acceptable. She lives in Anchorage with her two dogs Reese and Peanut, or as she likes to call them "Thing 1" and "Thing 2."