AMAC Blog

Blog , Lifestyle and Entertainment

Buying or Selling a Home? Beneficial Information on Disclosures

Posted on Thursday, June 23, 2022
|
by AMAC, D.J. Wilson
|
0 Comments
|
Print
Home

Buying or selling a home can be a complex matter as there are many forms, contracts, and disclosures. Regarding the latter, federal, state, and local laws affect what sellers need to disclose, or expose, to potential buyers. For example, in the state of Pennsylvania, home sellers are required by state law to describe material defects and other issues concerning the property in a disclosure form. Whereas a lead disclosure, to release information on the presence of lead paint in a home, falls under federal law. Disclosures are designed to promote honesty in real estate transactions and to protect buyers from buying problematic properties without their knowledge. Typically, sellers must provide lead-based paint disclosure documents to buyers before an offer is accepted.

Congress passed the Residential Lead-Based Paint Hazard Reduction Act of 1992, also known as Title X, to protect families from exposure to lead from paint, dust, and soil for housing built before 1978. For these older homes, buyers must be given an EPA-approved information pamphlet on identifying and controlling lead-based paint hazards. Buyers must also be informed of the presence of lead-based paint or lead-based paint hazards in the home or building. Additionally, homebuyers have a 10-day period to conduct a lead hazard evaluation or inspection, though the parties may mutually agree to shorten or lengthen the time, and buyers may waive the opportunity entirely should they so desire.

Disclosure rules affect the process of home sales and purchases. Since the rules vary from state to state, and locally, sellers must do their due diligence to check with the appropriate local planning departments within their town or city to gain understanding of expectations of sale. Per Investopedia, there can be loopholes, such as one in New York State. Regulations there require that specific problems be disclosed to a purchaser in a statement unless the seller opts to pay a $500 credit to the buyer at closing. “According to Nolo, an online legal library, many, if not most sellers pay the credit rather than providing the form.” Buyers should become educated on these loopholes to gain full understanding. Home sellers who fail to disclose required information, such as the existence of lead-paint, may be sued by the buyers for damages suffered. Additionally, there are rules in place to keep folks honest. For example, the EPA and HUD have authority under the regulations to impose hefty monetary penalties on any landlord, seller, or agent who knowingly violates the lead-based paint disclosure requirements. Additionally, real estate agents and brokers can guide sellers and buyers along the process to ensure paperwork is accurate and that all parties are properly informed.

Other things, such as a death in a home, may or may not have to be disclosed depending upon the state’s requirement. The “Ghostbuster Ruling” is commonly referred to regarding what information sellers must disclose. In this case, a seller failed to directly mention to the buyer that the home had some ghosts to include a young woman in a hooded cape, a naval officer from the American Revolutionary War, and an elderly levitating man. The home had received national attention in the past for being haunted. The buyer made a sizeable down payment, yet upon discovering the home’s history, wanted out. The buyer believed that the omission of the information equaled fraudulent misrepresentation. Since the seller failed to disclose the house’s history to the buyer, the buyer won the case as decided by the New York Supreme Court.

Though the above is not your average case, it emphasizes the importance of disclosures, namely that sellers must be transparent in the history of the home along with being upfront in condition and material defects. Despite that legal matter, there are also some cases in which sellers are exempt from providing the seller’s disclosure. This largely depends upon state law. The Texas Property Code identifies some circumstances in which the seller does not have to provide one. For example, per Abby Realty, if foreclosure or bankruptcy brought on by debt triggers the transfer of the property, no disclosure is required. Thus, it’s tricky business that comes down to the letter of the law. Likely it’s best to be open and honest so that no eyebrows are raised and so all parties are satisfied. Likewise, do rely on qualified professionals such as real estate agents, brokers, and legal experts for advice to protect and guide you through the challenging and somewhat delicate process of homebuying and selling.

This article is purely informational and is not intended as legal advice.

Share this article:
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments

Join Now!

Money-Saving Benefits News, Podcasts, & Magazine A Strong Voice on Capitol Hill

All Membership Packages Include Your Spouse for FREE!

1 YEAR MEMBERSHIP

3 YEAR MEMBERSHIP

5 YEAR MEMBERSHIP

LIFETIME MEMBERSHIP

Slow-Cooked Banana Bread Pudding
Potluck Taco Dip
Potluck Meals

Stay informed! Subscribe to our Daily Newsletter.

"*" indicates required fields

0
Would love your thoughts, please comment.x
()
x

Subscribe to AMAC Daily News and Games