Buying a new home is a milestone for everyone. Because it is a huge step, residential buyers are meticulous when choosing their homes. On top of the requirements on their list, they want to ensure that the house has no hidden conditions that could adversely affect their living conditions if they decide to buy it. This is why it is important for sellers to provide a disclosure document to their potential buyers.
California real estate disclosures
Under California laws, property sellers are required to provide potential buyers with a document outlining the conditions of the house, including defects that may not be visible during ocular inspection. The state provides the Real Estate Transfer Disclosure Statement (TDS), and the seller must disclose all applicable information about the property.
Furthermore, the seller must disclose the property conditions before the transfer of title or execution of the sales contract.
Failure to disclose on time
If the seller only made the disclosure after the offer acceptance or creation of the purchase agreement, the buyer has the right to terminate the acceptance or agreement within a specific period from the disclosure.
Lying on a TDS can also put the seller at risk of fines and lawsuits.
Are there disclosure exceptions?
Certain circumstances allow sellers to sell properties without having to make disclosures. Some exemptions are if the sale is:
- Due to a court order
- A foreclosure sale
- Due to tax default
- Between co-owners
- To a government agency
It is possible that the buyer will not push through with the purchase after the disclosure. However, this is better than facing the adverse implications of nondisclosure. Just as buyers are meticulous with selecting homes, sellers should be careful when creating the disclosure document to include all necessary information.