It finally happened. You toured a house, and it's exactly what you've been looking for. Knowing the market is moving fast, you quickly put in an offer without spending much time learning about the home. After all, it looks great.
But don't let your eyes deceive you.
Sellers know they need to make their home look great to list it on the market but oftentimes cover up problems.
While you learn a lot about the house through the home inspection, it's not guaranteed to find every concern. That's why the homeowner fills out a seller's disclosure.
The problem, though, is that most homebuyers don't know what to look for when they're reading a seller's disclosure, and without knowing what to look for, you could end up buying a property that has major hidden problems.
Here are six key things you need to know about seller’s disclosures, including what problems disclosure forms often cover, how the seller disclosure protects you, and options you have if your seller didn’t disclose everything.
Seller Disclosures Laws Vary by State
One of the first things you should do before buying a house is familiarize yourself with the state disclosure laws. The seller's disclosure will outline what kind of information the seller needs to disclose to potential buyers.
While most states have similar laws about what must be disclosed, each state has its own nuances, so make sure you're aware of them before buying a home.
The condition-of-the-home disclosure is a section of the seller's disclosure that lets the buyer know if the house has any current defects and or recent repairs done to the home.
Some of the things you might find on the condition-of-the-home disclosure include:
- Any damage to the structure of the home
- If there's any water damage or past flooding
- Mold or mildew in the house
- Pest problems
Sellers are also required to disclose if they've made any repairs to the home as well as when those repairs were done. This is important because it can help you determine if there are any potential issues that could pop up down the road.
While the condition-of-the-home disclosure is meant to give buyers a clear picture of the home's current condition, it's important to remember that sellers are only required to disclose what they know about.
If there's something wrong with the house and the seller doesn't know about it, then it won't be included on the disclosure form. That's why it's always a good idea to get a professional home inspection to ensure there aren't any hidden problems with the property.
Check Disclosure Form for Legal Concerns and Pertinent Information
A seller's disclosure isn't just about the physical condition of the home; it's also about the home's health, safety, and value.
Some of the things you'll find on the disclosure form include:
- If there are any outstanding code violations from the city or county
- if there are any hazardous materials on the property, such as lead paint or asbestos
- The home's zoning classification
- The existence of a homeowners' association and its rules and regulations
- Unlawful, illicit or potentially disturbing events or behavior that took place within the home—for example, natural deaths, homicides, drug busts, or cult activities.
- Legal issues connected to the property, such as property disputes or neighborhood nuisances
- Which appliances will stay and which will need to be replaced.
It's important to be aware of any legal issues before buying a home because it could end up costing you a lot of money down the road.
Disclosures Are a Legally Binding Form
Once you've signed the disclosure form, it's legally binding. This means that if the seller lies about something on the form, and you find out later, you can't take legal action against them.
The only exception to this rule is if the seller purposely hides or withholds information from you that they know would affect your decision to buy the property.
If you think that the seller has misrepresented something on the disclosure form, your best course of action is to consult a real estate attorney. They'll be able to advise you on whether or not you have a case and what your options are moving forward.
What Happens If My Seller Didn't Disclose Everything?
Unfortunately, there's not much you can do if the seller didn't disclose everything on the disclosure form.
That's why it's so important to make sure that you thoroughly read the disclosure form and ask any questions you have before signing it.
You Still Need a Home Inspection
Even if the seller has disclosed everything on the disclosure form, you should still get a home inspection.
There could be things that are not included on the disclosure form, like hidden damages or repairs that were done without permits.
A home inspector will be able to tell you about any potential problems with the property that might not be visible just by looking.
Don't allow yourself to get lulled into a false sense of security and confidence in the condition of the home you want to buy after you receive the seller’s disclosure form.
Remember that the disclosure is only a snapshot of the property as it stands at that moment, and things can change. If you have any additional questions about what to look for in a seller's disclosure form, please don't hesitate to give me a call.
Disclaimer: This blog post should not be taken as legal advice and is for educational purposes only. If you have specific legal concerns, please consult with an attorney.