Real estate is a well-regulated industry, and one of the items that allows this to be possible is called a disclosure. A disclosure statement is a buyer’s chance to learn as much as they can about the property and the seller’s experience in it – and about what issues might be present.
At Rockport Properties, Inc., we won’t deal with properties unless they have accurate disclosure statements. Let’s look at everything you need to know about disclosure statements before you search for your next home.
What’s a Disclosure?
As we noted, a disclosure is a chance for all information about a property to be laid out on the table. Sellers will disclose documents that help inform buyers, and that can help protect the sellers themselves from potential legal action. It’s the seller’s chance to reveal anything that might negatively impact the value or usefulness of the property.
How is a Disclosure Made?
These laws vary between states, and even between cities or counties. Sellers and their agents will have to sign off on several documents. Disclosure usually comes in the form of boilerplate documents, where the seller answers many yes or no questions about their home. Sellers must also present any documented information about a substantial defect or an item that could have a big impact on value. Sellers can be on the hook for what they disclose for up to 10 years depending on the area.
What Do Sellers Disclose?
Sellers disclose previous improvements or renovations, and whether any work was done with or without permits. They also disclose any pets, termite problems, neighborhood issues, property line disputes, and any defects with major systems or appliances. These documents also often ask sellers if they are involved in any bankruptcy or lien proceedings.
Is a Disclosure the Same as an Inspection?
No. An inspection is done by a third party, while a disclosure is done by the seller themselves. The buyer should always utilize a thorough, third-party property inspection before moving forward with a purchase.
When Does the Buyer Receive Disclosure Statements?
In most markets, disclosure documents are provided once a seller has accepted an offer. In addition to inspections or loan contingencies, the buyer can then review the disclosures. In some markets, this is done before an offer.
Want to learn more about disclosures, or interested in any of our other property services? Speak to the experts at Rockport Properties, Inc. today.