Helping Seller Clients Understand the Importance of Disclosures
Seller’s disclosures are likely something relatively unfamiliar to your clients if they’ve never bought or sold a home. However, as an agent you know they play a vital role in one of the largest and most important transactions we experience in our lifetime. Whether you’re on the buying or selling side, the seller’s disclosure paperwork helps all parties reach a common understanding of the perceived condition of a home.
With that said, let’s dive a bit deeper into what a seller’s disclosure is, why it’s required, what information is disclosed, and more. Feel free to share this information with your seller clients to help them understand the importance of the disclosure process!
What Is a Seller’s Disclosure Form?
The intention of the seller’s disclosure documents is to clearly communicate a listed property’s condition; providing details into any issues, repairs, or defects. Aside from highlighting problems, a seller’s disclosure document also contains information on any upgrades and renovations done to improve the home.
The exact contents of a seller’s disclosure vary from state to state. The guidelines change based on local conditions and laws, so it’s advised that sellers look into their state’s specific requirements.
For example, in California, this document is called the Transfer Disclosure Statement and the specific paperwork and questions are unique to the state. However, regardless of location, the baseline contents generally remain the same. Example questions are:
- Are you (Seller) aware of any significant defects/malfunctions with any of the following? (Roof, Driveways, Ceilings, Windows, etc.)
- Are you (Seller) aware of any of the following: any encroachments, easements, or similar matters that may affect your interest in the subject property?
- Are you (Seller) aware of any of the following: any settling from any cause, or slippage, sliding, or other soil problems?
- Are you (Seller) aware of any of the following: neighborhood noise problems or other nuisances?
If your state/area has special weather conditions, there may be specific weather-threat disclosures. For example, Oklahoma, Louisiana, and Mississippi require flood zone disclosure, while California requires notice if the property lies in a very high fire hazard severity zone.
Why Is It Required?
Seller’s disclosure documents enable all of a transaction’s active parties to have full knowledge of the property’s history. These insights are vital to both buyers and sellers. This, combined with any inspections conducted during the due diligence period, provides buyers with a clear understanding of what they’re purchasing so they can ensure they’re making the best possible choice.
When a seller has properly and accurately disclosed all the necessary information within the documents, they limit their liability for any issues that develop in the future. With that being the case, buyers may be unable to legally pursue the past owner since they were fully aware of the issues prior to purchasing.
Importance of Legitimate Disclosure
The most important aspects of a seller’s disclosure are honesty, accuracy, and understanding. While disclosure documents work to protect the seller, they can only do that if they’re correctly filled out. If a seller’s disclosure has errors, missing information, or wrongly stated details, the seller could be legally liable for these mistakes.
It’s key to remember that sellers can be sued if they purposefully mislead and/or leave things out that they know about — even things that were fixed and are past issues.
Helping Your Clients Through Disclosures
While real estate agents cannot (and should not) provide legal advice, you will be often asked to help navigate any questions sellers may have about the disclosure process.
One of the best ways to ensure that the seller’s disclosure documents are taken care of accurately is by using Glide. Glide is making the disclosure process safer, easier, and faster than ever before; so be sure to check out glide before your next transaction.
See more at…https://www.glide.com/blog/helping-seller-clients-understand-the-importance-of-disclosures