When purchasing a new home, it is important to know everything about the house and property. That’s where a seller’s disclosure is here to help. Keep reading to learn exactly what a seller’s disclosure is and why it’s important.
What is a seller’s disclosure?
A seller’s disclosure, also known as a property disclosure or home disclosure, is a document that sellers legally have to provide to their buyers. This document will list any undisclosed details pertaining to the property that could negatively affect the home’s value.
Why is a seller’s disclosure important?
Seller’s disclosures bring transparency to a real estate transaction and can protect both buyers and sellers.
For buyers
Receiving a seller’s disclosure gives a buyer the full history of a property as well as informs them about any future repairs. Issues disclosed may cause some buyers to want to pull out of the transaction, which they can do without losing earnest money.
Problems reported in the seller’s disclosure can also give buyers negotiating power on certain terms of the home, such as the home’s price or requesting repairs.
For sellers
Only if a seller’s disclosure is done precisely and legitimately can it protect the seller. This means that the document has the possibility to safeguard the seller from being held legally liable for issues that may develop in the future. Note that a seller only needs to disclose what is required by their state.
What are the standard disclosures?
Varying from state to state, seller’s disclosures have different requirements. Plus, certain counties may also have their own requirements. Be sure to check your state’s seller’s disclosure guidelines.
To get an understanding of what you can expect, check out these standard disclosures:
- Repairs
- Damage
- Hazards
- Missing items
- Death having occurred in the home, if a buyer were to inquire
- Neighborhood nuisances
What happens if a seller does not disclose all information?
If a seller fails to disclose all information required by their state, they are at risk of getting sued by the buyer.
When should I expect to receive a seller’s disclosure, and will I always receive one?
Typically, a seller’s disclosure is provided within the closing stage of a real estate transaction. Although some sellers may disclose information early on, the listing agent must be truthful about any known issues.
It is also important to note that you may not always receive this disclosure. A “no seller’s disclosure sale” can take place for many reasons, such as being sold “as-is”, a foreclosure or estate sale, a gift to a parent, spouse, domestic partner, or child, or a transfer between domestic partners during divorce.
Seller’s disclosure in Alabama
Alabama is a caveat emptor state, which means there is no law requiring a seller’s disclosure for real estate transactions that occur there. Learn more about caveat emptor in this article from the Alabama Association of REALTORS.
Summary
Are you ready to buy or sell your home? Work with a professional who knows all the ins and outs, such as the seller’s disclosure, like Ryan Roberts! Plus, you can learn more about real estate in our area by checking out our blogs.
