Experienced. Driven. Effective.

How a seller’s disclosure could cause issues with a real estate transaction

On Behalf of | Dec 17, 2023 | Real Estate Transactions

When someone is selling a piece of real estate property, they have to create a seller’s disclosure. This is intended to provide transparency so that the prospective buyer knows what they’re investing in. They deserve to know all of the facts about the property so they can determine the real value. If something is disclosed that makes them wary about buying the property, it could lead them to make a different offer or even walk away from the deal entirely.

However, sellers are also aware that this disclosure could be detrimental to their efforts to sell their property for as much as they can get in the current market. Can a seller just keep things secret until the transaction is over?

Disclosure of known defects is required

No, the seller cannot keep these issues a secret, as they have to disclose any known issues. These could include defects to the home, damage from a storm, termite damage, issues with systems that are breaking down – such as a broken HVAC system or a leaking roof – and much more.

But one of the potential issues that can sometimes arise is that the seller only has to disclose “known” issues. It is certainly possible for the seller to not know about problems within their home. The seller is likely not a professional homebuilder or a home inspector, so they could entirely overlook issues that may be very obvious to someone else.

This is one of the reasons why a home inspection is so important during the transaction process. But it can also lead to significant issues where a seller is accused of intentionally hiding problems with the home, and then those involved need to understand their legal options.