The Importance of Home Seller Disclosures
With today’s market and so many different types of situations where sellers are short sales, lender property, or auction houses, it’s more important than ever to make sure you’re checking out the home thoroughly. Most of these types of properties do not have property disclosures from the sellers and you have no indication of any previous problems with the house. Past problems with properties can be very important in your decision to buy a property or not.
If you are buying a home, it is recommended that you try to buy one that has full property disclosures from the seller so that you have an opportunity to review everything that is known about the property. Some of these things include various nearby issues that could cause you to reconsider buying this property. Nearby airports, noisy highways and plants, as well as chemical or power plants that may be too close for your liking. Most things have to be discovered on your own, but many times buyers are unaware of something that might be coming soon that the previous owner might know about.
Usually, problems with the home are more likely to be a major concern for the buyer. Many things, such as certain pests like scorpions or termites, can be revealed in seller’s property disclosures. Other things, like water damage or a roof leak inside the house, are some items you’ll want to look at and ask questions if they’re in the disclosures as issues above.
In a recent disclosure, a past leak was mentioned without any real elaboration, but upon further investigation, the buyer discovered that this two-story home had such extensive water damage that it literally cost $100,000 to restore. In this particular case, the buyer reconsidered buying the house for various reasons. Questions arose such as possible stray damage or mold from one floor to the other or within the walls. Did you weaken aspects of the home that could cost the buyer additional money in the future? What about the fact that the new owner would have to disclose this huge water damage problem to the next buyer and it might scare off potential buyers for them?
Lender-owned homes will not come with property disclosure statements from sellers, just like flipped homes purchased at auction. These homes need to be inspected very carefully, and as a buyer, you need to be very sure that you are comfortable not knowing what past issues happened to the home. Don’t take lightly not having disclosures and definitely don’t accept a home that the seller knows about but doesn’t want to provide such disclosures; this should be your first clue.
Make sure all disclosed items are explained very well rather than just reading through some that has been disclosed without getting a detailed history.
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