When in Doubt, Always Disclose, by Ron Wynn

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Real estate dialogue is never black and white. The good news is, you are obligated to disclose only what you know. You are not obligated to explain the cause of a problem if you are not specifically knowledgeable. As a homeowner, don’t make assumptions or conclusions unless you are qualified. However, do disclose:

  1. Anything disclosed to you by a prior owner.
  2. Any problems that you have experienced that you have, either successfully or unsuccessfully, attempted to rectify.
  3. Answers to all questions on the California Residential Real Estate disclosure and on the Seller Property Questionnaire.
  4. Anything that you believe could make your property less desirable, less valuable, or non-conforming in the eyes of any potential buyer. An example might be a neighbor next door who continuously screams at her children to the point that you can hear it from your yard.

I’ve often had an owner ask, “Do I need to disclose that the patio was enclosed by a prior owner without a permit?” My answer is, “If you are aware, you must disclose it, even if it was done by an owner 20 years ago.” If you don’t know it as a fact, then say “It may have been without a permit and it may not have been done to code.” If you have no knowledge at all, then it is reasonable to say nothing. Keep in mind that codes are always changing and many improvements made 10 years ago, with or without permit, may not meet current codes. I have even stated this as a boiler point in cases where funky additions were made that warrant such a statement. The fact that something was done by a prior owner is immaterial. If all you know is that and you have no idea if it met code or not, then simply state that in simple words.

Another example may be a neighbor telling you that your fence is encroaching by 3 inches on his property. Say for example you never had a survey to verify whether his statement is true or not. In such a case, simply state that the neighbor has called this to your attention, but that it has not been verified. A buyer can then choose to make a further investigation if they choose.

Perhaps you learned from a neighbor that somebody drowned in the pool before you purchased the home. (God forbid) if it were me, I would disclose it. If it can be proven you had prior knowledge of an issue you did not disclose, a court can find you on the wrong side of the law. My advice is, when in doubt, always disclose.

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