To protect buyers, sellers are required to reveal certain information about the house. These disclosures, often referred to as - transfer disclosures - inform buyers about existing problems.
Disclosures apply not only to the house, but also to the area surrounding the house. Each state has its own disclosure requirements and some disclosures are required by federal law.
Disclose Items Included in the Sale
It is important that both you and the buyer understand what is and is not included in the sale. Failing to make clear what is included in the purchase price could result in a lawsuit.
It is better to err on the side of caution, and to make sure that you closely look through your home and mention any items that you plan to take with you and that might cause a misunderstanding, such as a range, oven, dishwasher, TV antenna, chandelier, hot tub, microwave, water softener, gazebo, and a built-in barbecue, to name a few common examples.
Disclose Any Natural Hazard Risks
Natural hazard risks are determined by federal and state governments, which divide areas into "natural hazard zones." If your home is located in one or more of these natural hazard zones, you must disclose this situation to your buyer. Hazard zones include flood zones, fire zones, earthquake fault zones, seismic hazard zones, and state responsibility zones. State responsibility zones are usually wild-land areas that may contain substantial forest fire risks and hazards.
Disclose Any Health and Safety Issues
You must disclose any health and safety issues to the buyer before finalizing the sale. The presence of lead-based paint is a common health and safety issue, particularly if the home was built before 1978. You must also disclose the presence of toxic mold, which can cause serious respiratory problems. You must disclose asbestos, once used to insulate furnaces and pipes, and in ceiling tiles and roofing tiles.
Disclose Any Hidden Defects
Long ago, it was common for sellers to hide problems with the house from potential buyers, who then discovered these problems after moving into the house. To protect buyers, the law now requires that you disclose any known problems with your home before the sale is concluded. You must disclose only those defects that would not be obvious to the average buyer walking through the home.
For example, you may not have to disclose that a large crack exists in the living room wall, since a potential buyer can see the crack. However, you must disclose the existence of a leaky roof, if this is only noticeable in a heavy rain. If you fail to disclose these hidden defects, the buyer could back out of the purchase agreement, or sue you after purchase.
Local Disclosure Requirements
Counties and cities often impose additional disclosure requirements for properties within their borders. Examples of required disclosures include whether there are any registered sex offenders that live close to your home, whether your home is equipped with smoke detectors, whether the water heater meets local building codes, whether the home has lead-based paint, whether anyone has died inside of your home, and whether the home has any structural pests such as termites.
A Residential Real Estate Lawyer Can Help
The law surrounding what a seller must disclose when selling a home is complicated. Plus, the facts of each case are unique. This article provides a brief, general introduction to the topic. For more detailed, specific information, please contact a residential real estate lawyer.