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Home Seller Disclosure Obligations

To protect buyers, some states require by law that you inform buyers of known things that may not be immediately evident as to the condition of the property. Whatever the case may be in your state, you will be far better off if you create a disclosure statement by completely and accurately detailing anything pertaining to your property.

You are going to need to disclose information about who the property owners are, what property is being sold and when the sale date is. In addition, you will need to disclose change of ownership, physical condition reports of the property, as well as how the reports were obtained

What Should a Seller Disclose?

When selling your home, you may be obligated to disclose problems that could affect the property's value or desirability. In most states, it is illegal to fraudulently conceal major physical defects in your property such as a basement that floods in heavy rains. And states are increasingly requiring sellers to take a proactive role by making written disclosures on the condition of the property.

For example, let's say that your basement floods during heavy rains. In preparation for sale, you paint the basement walls and floor and in so doing, you conceal all evidence of past flooding. If you sell your home during the dry season, the buyers won't be aware of the fact that the basement floods. This is a material fact that should be disclosed.

The best way to avoid a lawsuit over property defects is to be proactive and disclose what you know about the property's faults before the sale closes. In addition, it's a good idea to disclose items of routine maintenance that must be taken care of in order to avoid future problems, like roof gutters that must be kept clean or a skylight that will leak unless it's kept well-caulked.

Sellers Must Disclose Lead-Based Paint and Hazards

If you are selling a house built before 1978, you must comply with a federal law called the Residential Lead-Based Paint Hazard Reduction Act of 1992 (U.S. Code § 4852d), also known as Title X. You must:

  • disclose all known lead-based paint and hazards in the house
  • give buyers a pamphlet prepared by the U.S. Environmental Protection Agency (EPA) called Protect Your Family from Lead in Your Home
  • include certain warning language in the contract as well as signed statements from all parties verifying that all requirements were completed
  • keep signed acknowledgements for three years as proof of compliance, and
  • give buyers a ten-day opportunity to test the house for lead.

If you fail to comply with Title X requirements, the buyer can sue you for triple the amount of damages actually suffered. the National Lead Information Center.

Right to sale listing agreement?

If you do decide to hire a real estate agent to assist you in selling your home, he or she will define the terms of your agreement in writing. This is called a listing agreement. The agreement will cover such items as:

  • Length of time the agreement covers
  • Commission to be paid to the agent
  • Advertising or other promotional materials the agent will provide
  • Sale price of the home
.

Title of the property

Homeowners' association: Does the owner have to pay monthly dues? How much, and what do they cover?

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