Real Estate

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State law

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Many states require residential property sellers to either disclose material information about property offered for sale, or to sign a disclaimer stating that property will transfer as is. Often, these laws apply regardless of whether a real estate agent is involved in the transaction.

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Federal law

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There are no mandatory Federal property disclaimer or disclosure forms. However, there are other mandatory Federal disclosures related to property. For example, the lead base paint Hazard reduction act in poses obligations on those who sell or lease property built before 1978.

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Lead-based paint Hazard reduction act disclosure

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Sellers and lessors must disclose whether or not they have knowledge that lead base paint is present on the property.

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Lead-based paint Hazard reduction act pamphlet

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Sellers and landlords must provide all purchases and lessees of pre 1978 property disclosure pamphlet and at least 10 days to inspect the property for lead-based paint.

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Agents role in preparation

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Agent should never fill out a disclosure form for the seller. And agents duty is for advise the sellers of the states disclosure laws and the sellers obligations they're on their period using disclosure forms as a layer of protection for all parties in the transaction, but the forms and cells do not replace an agent's independent responsibility to disclose all material property defects nobody

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When sellers disclosure misrepresents property condition

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If a disclosure form contains a knowingly false or incomplete statement, the seller may be liable to the buyer for the damages / lost the fire suffers as a result of that misrepresentation. Failing to make the disclosures could result in liability for fraud and / or misrepresentation as a result of the Brokers concealment.

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Home warranties

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Home warranties will not relieve the seller or the agent of their duties to disclose material defects in the property, however, the warranties May prevent a claim due to misrepresentation because it gives the buyer a way to fix certain problems that might arise after settlement.

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Warranties for resale homes

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Buyers can purchase, or sellers can provide buyers with, home warranty plans that cover some major appliances and systems in the home. The plans generally cost between $250 and $400 for the first year, with an option to renew for a higher rate. Agent should make sure buyer clients understand coverage and limitations of the plan.

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Warranties for new homes

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Warranties for new homes are backed by the Builder or purchase from an independent company that assumes responsibility for certain claims. They generally offer limited coverage on work when shipping materials relating to components of the home for specific periods.

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Agent responsibility to verify statements included in marketing information

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Generally, the listing agent owes no duty to independently verify the accuracy of any statement in the marketing taken from a source that the agent reasonably believes to be reliable. However, the agent must not advertised in a manner which knowingly misrepresents the property. In addition, all ads must comply with the state licensing law, including those requiring the advertising to be truthful and not misleading.

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Agent responsibility to verify / inquire about red flag issues

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An agent need not investigate the property for material defects, but he may not be willfully blind to its condition. A licensee is expected to exercise good professional judgment and recognize problems that are apparent. And agent is not expected to inspect for latent defects. However, there is frequently and easily observable red flag concerning a potentially dangerous problem. An agent should pursue such red flag items with the seller to determine the extent of the problem with an eye toward repair and / or disclosure, as appropriate.

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Responding to non-client inquiries

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Listing agents must respond truthfully to any question asked by the buyer / customer and must treat the buyer / customer fairly. Agent should be sure of their facts before responding to an inquiry. The agent should State the facts, but not interpret or evaluate the property condition. If the agent expresses an opinion, it should be clear that it is an opinion and not a fact.

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Material facts related to property condition or location, public control, statutes, or public utilities

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A material fact is information that is sufficiently relevant to influence a decision. Most state license laws require Brokers and other agents to disclose material facts that they know or should know to clients and customers.

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Material facts

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Often it is difficult for an agent to determine whether a condition, if it exists, would be material for the purposes of disclosure. Many property features may be important to one buyer, but not to another. However, unless specifically exempt from disclosure under state law, if an agent becomes aware of the following problems related to the property he is listening or selling, he will likely consider the material and the kind of effect that should be disclosed to potential buyers.

A. Adverse land and soil conditions. B. An accurate representation of lot or Improvement size. C. Encroachments or easements affecting use. D. Pest infestations. E. Toxic mold or other interior environmental hazards. F. Problems with structural items. G. Problems with the condition of electrical or Plumbing Systems. H. Problems with condition of appliances / fixtures. I. Location in natural Hazard Zone. J. Located in specially regulated area. K. Potentially uninsurable property. L. Property would known alteration / additions. M. Local zoning and planning information. N. Mistaken location of boundaries of school, utility, or text station districts. O. Properties on Airport flight paths. P. Whether the property is subject to Lanes, local taxes, special tax liens, or assessments. Q. Existence of environmental hazards. S. Whether the property is stigmatized, or psychologically impacted. T. Megan's laws issues.

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Common law Duty

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In addition to any applicable state laws, real estate agents have a common law duty to disclose material facts that the agent knew or should have known about a properties physical condition to the customer.

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Nature of material information

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Material customer information includes structural defects, and health hazards.

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Consequences of failure

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Failing to disclose material facts to the customers is a potential basis for an action of fraud or misrepresentation, and rescission of the sales contract.

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Latent defects

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Latent defects are defects in construction that are not readily apparent. Any defect that is Leighton is a material fact that must be disclosed at the agent knows or reasonably should know of its existence. Failing to disclose latent defects to a bar May expose a seller and his agent to a lawsuit for fraud and / or a violation of state license laws. Defects that are readily apparent, like a cracked Concrete in the driveway, are generally not considered to be latent defects.

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Stigmatized properties

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I signifies property is one in which an event or condition occurred that does not affect the physical nature of the property, but may affect its value to some people. There is no common law or federal requirement to inspect for, investigate, disclose, or verify whether a property is stigmatized.

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State law

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Some state laws explicitly exempt or required disclosures about Sigma ties property and specifically defined covered and excluded stigmas.

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Federal law

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There is no federal law that covers Sigma ties property generally. However, the fair housing act, for example, prohibits disclosure of a person's HIV / aids status.