Importance of Property Disclosures
Today I want to talk to you about some potential legal issues that could come with selling your house. There are rules put in place to protect buyers when purchasing a new home and if sellers don’t follow them, it could end up potentially costing sellers a lot of money!
When you listing your home you will get a document called the Seller’s Disclosure of Property Condition as part of the listing paperwork. This is sort of the bible for your home. It is designed to be the seller’s record of any past problems and they ask you to specify on questions about the basement, foundation, water, electrical, plumbing problems, and more.
YOU HAVE TO DISCLOSE WHAT YOU KNOW. That is the BEST advice I can give.
If you don’t disclose issues with the home that were known to you or that you had repairs done on in the past, there can be some pricey repercussions. Here were some recent stories that ended up in court that happened in Iowa that are worth paying attention to.
Sellers had a sump pump go out, filed a claim with the insurance company and the insurance ended up paying for carpet repair. When they went to list their home and when asked on the disclosure if they had ever had any known water issues with the home – they checked ‘no’. Two years later with the new owners they ended up with water in their basement. The company that came out to repair the problem told the owners that they had been there before for water issues. The new owners filed a lawsuit against the sellers, it went to court and they ended up having to pay a lot of money. Even though there was no malice behind their decision to check no – the fact that they had in fact had water previously, obligated them to check yes on the disclosure.
Another one that recently happened, the new owners found SNAKES in their home. They took the sellers to court and the sellers admitted in court that they were aware that there were snake issues in the past and had taken known actions to prevent snakes. They had lived there for over 30 years but hadn’t had any problems for nearly 14 years and because it had been over a decade since they saw any snakes they thought that they didn’t need to disclose this. Unfortunately, THEY DID. The sellers ended up having to pay an enormous amount of money - almost $190,000. They had to pay for the repair and court costs, attorney fees, etc.
So, if there is one take away from this today…disclose everything!! When in doubt – disclose!
As always, if you have any questions about real estate, selling your home or buying – don’t hesitate to reach out.