Disclosing Defects When Selling a Home
What are the Laws regarding Disclosing Defects when Selling a Home?
In general, when a person is selling a home, they are obligated to disclose any material defects or problems in the property. While laws covering full disclosure may vary from state to state, the seller should inform the buyer of any defects that may cause injury or that would affect the buyer’s decisions to purchase the home or not.
On the other hand, a seller is not required to disclose every single thing that is wrong with the home. Minor defects such as sticky doors or small cracks in the wall need not be disclosed, especially if they are not hidden from the buyer.
What must be Listed in a Disclosure Form?
Many states follow the rule of “caveat emptor”, or buyer beware. This rule states that the buyer assumes the risk of purchasing a home that contains defects. However, some of the more major problems that a seller needs to disclose include:
- Leaks in the ceiling or roof
- Basement flooding
- Toxic conditions such as the presence of lead, mold, radon or asbestos
- Whether the home is exposed to dangerous natural conditions such as a flood zone or an earthquake fault line
- Faulty electrical wiring
- The presence of pests such as termites, insects, or rodents
- Mechanical problems such as heating, air condition, or other problematic appliances
In addition to the duty to disclose, a seller may not engage in active concealment of defects in the property. For example, they may not paint over faulty wiring in order to conceal the problem from a potential buyer. Finally, brand new homes are subject to an implied warranty of fitness, which means that they should be sold in a condition that is generally suitable for habitation.
Who is Required to make a Disclosure of Defects in a Real Estate transaction?
As mentioned, the seller’s duty to disclose often depends on the seriousness of the defect. The seller is basically required to disclose material, substantial defects that would affect acceptance of the offer.
If a seller is being represented by a real estate broker or agent, the real estate professional will also have a duty to disclose defects. Real estate agents and brokers are held to higher standards than the average homeowner. In most states, if a real estate broker or agent knows of any major defects in the property, they must disclose it to a potential buyer, even if the seller is not required to do so.
What if I was not Informed of a Serious Defect in a Home that I Purchased?
If you have purchased a home and then later discovered a major defect, you may be able to recover damages. You may be able to bring a claim against the seller, or against a real estate professional who failed to make the disclosure. You may be entitled to have the seller or other party pay for repairs of the dangerous condition.
Also, if you have been injured by the dangerous defect, you may be able to recover losses for your injuries. Be sure to document any instances of injury using medical records, receipts, etc. You may also wish to take photographs or video footage of the dangerous condition so that you have a record of the defect before it is repaired.
In order to protect yourself, you may consider having the home separately appraised and thoroughly examined for defects. If you will have the home inspected, be sure to hire an independent professional who is not working in tandem with the seller or their real estate agent.
Do I Need a Lawyer for issues with Disclosure of Defects in a Home Sale?
In addition to providing information regarding the sale of a home, such as price, age of the home, etc., a seller has an affirmative duty to disclose dangerous defects. Failure to do so may result in legal liability. If you have been injured by a defect that was not disclosed to you, you may have a viable claim in a court of law. An experienced lawyer can help represent your interests so that you can recover your losses. Also, real estate attorneys can provide helpful advice before you make a home purchase.
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Last Modified: 01-17-2013 01:19 PM PST
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