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Tuesday, February 16, 2016

Home Seller Tips: Disclosure of Defects is a Shield

With foreclosures there is usually very little property information available except what a prospective buyer can glean from public records.   Additionally, a good property inspector can likely provide some other very useful information.
Image courtesy Stuart Miles at FreeDigitalPhotos.net
Perhaps the neighbors may know something about the property's past life.

Still, more is likely unknown than known.

What is the Latin phrase I am thinking of? Perhaps "caveat emptor."

When buying a foreclosure the risks must be understood and accepted.

Now when the foreclosure buyer becomes the seller several years later after using a house for rental income there is now a responsibility to disclose anything known about the property that materially affects its value.

Just this week I saw a property disclosure for a property that stated "owner has never lived in the house. Has been a rental for eight years."  In this case the seller had not bought it at foreclosure but rather within one year of construction.

Still, never lived in does not usually mean knows nothing.

If there have been repairs, replacement items, systems issues, then the owner likely knows. (How many tenants repair everything in a house and never tell the owner?)

Likewise, a real estate agent, whether working with a buyer or seller, must disclose anything that materially affects the value of a property if not readily apparent. Still, even owner occupants can forget to disclose something.

As for the motivation of any seller, when it comes to property disclosure, buyers have no way to know for sure if something was overlooked intentionally or forgotten. It all comes down to "diligentia quam in suis."

As a seller err on the side of disclosing unimportant items rather than omitting something that is potentially critical.   I recently read one agent call disclosures as a shield to protect sellers.

Disclosure of some things is a matter of law. Disclosure of other things is a matter of conscience.


Here is a post with links to eight posts about seller property disclosures.



agent@moving2brevard.com

The above post was initially posted on my Activerain.com blog.  

Image courtesy of Stuart Miles at FreeDigitalPhotos.net



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