Disclose, Disclose, Disclose

If you are in the market for a home, you should know that State law requires that sellers of residential properties provide you with full disclosure of material facts. The current law applies to ALL sellers regardless of when (or if) they last saw the property. It also applies to properties sold without assistance of a licensed agent. Corporate sellers (banks) are exempt as are related parties. REALTORS® use a standard Real Property Disclosure Statement. It is constantly refined to meet current conditions. It has been reviewed by legal experts to ensure it encompasses a broad range of topics deemed “material.”

How Much to Disclose

The expectation is that issues that might affect a buyer’s decision to purchase might also affect how much they would offer and should be disclosed. Because of cultural diversity, personal sensitivities or personal requirements, buyers and their agents should be aware of nuances of the standard form. Agents often become aware of issues that are important to a particular buyer.

What to Disclose

As an example, a death (unless notorious) is NOT a required disclosure. A murder, probably; suicide probably not. Deaths do not affect the property value and yet in our island community, many buyers have strong feelings about such things. For this reason, I always advise that sellers disclose this kind of information, even if not required. This is a small community, so buyers normally learn of such information at some point. It’s the type of thing that can destroy a transaction and create distrust between the parties. Sales made without REALTOR® assistance are normally made with a very abbreviated disclosure, if at all.

Not surprisingly, buyers often return to the property several times prior to closing. Neighbors want to be helpful and will disclose this and other information. But, just like a tenant who wants to queer a sale by providing “undisclosed” information, neighbors should be careful when discussing things for which they have no direct knowledge. If a sale fails due to misinformation, a nosey neighbor or tenant could be held personally accountable.

Disclosures Protect Both Buyer and Seller

At the same time, agents who have been around a long time might have historical knowledge that even an owner may not know. We are required to make additional disclosures, but the standard is the same; our knowledge should be direct and accurate. So, not only are disclosures required by law, they provide important protections to buyer and seller alike! It’s only one piece of the information puzzle necessary prior to a sale being consummated!