SELLING AND DISCLOSURE
putting your home on the market, better be sure you're ready to tell
all - good
The majority of lawsuits or claims
that occur are as a result of buyers finding
out about something that is wrong with their property after the close
and coming to the belief that the seller knew but didn't tell them.
is vital. In one extreme case, it may have spared a seller from
going to jail
and even saved lives. The New York Times reported on a trial in the
eighties that found the seller of a home guilty for not disclosing to
buyers that the home's heater had malfunctioned. The buyers and one of
children were asphyxiated by fumes from a gas-fired heater used to
driveway of their home. Only their 4-year-old child survived. The
convicted of involuntary manslaughter.
This case is believed to be the first
of its kind where a home-seller was held
criminally liable for the sale of a home that had a fatal defect.
While certainly this isn't a typical
scenario, it gives good reason to pay
attention to the details that you're disclosing when selling your home.
not worth it to leave off some important details just because you think
home won't sell or will sell for less money if you disclose any
BUYER CAN DECIDE
WHEN TO DISCLOSE
- The seller
might adopt the attitude that there was something wrong but it's not
therefore, he does not have to disclose it. This is fairly risky. If
haven't disclosed it and it turns out to be a problem, then you have a
potential significant issue, whereas if it's been disclosed, then the
elect what to do with it."
- In most cases, the buyers won't decide to
do anything further. This is
because the problem has been disclosed by the seller and reported that
been fixed. This will allow the buyers to feel that the problem has
completely resolved and therefore will not hold up the sale of the
are not unreasonable and if you are honest with them they will feel
safe in the
- Reporting all problems with the home,
regardless of whether they have been
fixed, is the safest way to sell your home. Making sure you keep good
is vital because, as the years pass, many sellers forget about all the
they've done to the property.
- It is also a good idea for every homeowner
to have a file of everything they do
to the house. This file could be given
to the buyers for them to review. The file should show all problems and
they have been repaired, complete with receipts.
- Even though legally there's no real
requirement to tell about fixed problems,
those are as critical as the existing problems. When you don't report a
problem, buyers generally learn about it from neighbours and then
you were not telling the truth when you sold the home.
- Sellers often resist disclosing problems
for fear that their homes won't sell
but that's generally fallacy. If the problem is major you cannot take
of not disclosing and if the problems are minor, rather negotiate now,
face later litigation - creating a huge
- If the seller properly discloses all
issues with the home, the buyer can make
an educated decision to buy or not. The fact is that the vast majority
buyers don't walk away. They decide to buy a house because they've
it's the house for them. Once they've made that decision they usually
way to make it work.
best time to disclose? Right away. The good real estate agents will get
whatever negative information there is out there as fast as possible,
as the first opportune time. Once
buyers make a decision to go forward they will have made their decision
upon all these factors, including the not so good. Professional agents
are also good
negotiators – they will make sure you get the best deal possible –
disclosing some problems.
When you tell all before you sell,
you're positioning yourself not only for a
successful home sale but also a headache-free post sale. Do also
remember that agents are bound by law to disclose any major defects or
issues that they are aware of.
as a matter of standard procedure have all our sellers complete a
Seller Declaration form and recommend you report ALL known defects on
the form, prior to commencing with the
marketing programme. This allows us to discuss if necessary, with legal
which issues should be raised within the contract and which not.
our experience, this shows the Buyer that you are transparent and puts
them at ease - after all, they are buying a second hand home and are
expecting certain defects to be in place. They are not expecting perfect - just honest.
Back the Seller Advice Centre
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