So you’ve put up a “home for sale” sign, and have potential home buyers. You know what your home is worth and you’re ready for negotiation. Well, hold your horses!
Before you sell your home, California requires home sellers to disclose certain details about it. Any homeowner selling a property is obligated to put these disclosures in writing, no matter if it’s a top-dollar condo unit or a humble mobile home.
These disclosures are important to give homebuyers as much information about a property, letting them evaluate whether they want to buy your home and how to negotiate. According to real estate disclosure laws, sellers cannot omit, falsify, or manipulate information. If so, they will be held liable for their omission to the full extent of the damages caused by the lack of disclosure.
This article will talk about the basics of disclosures before selling your property. The coverage of this article will be the most general terms. Regarding specifics for your home, it’s best to consult with a real estate attorney to help you sell a home.
When Should I Provide Disclosure Information When I Sell my Home?
You need to do this “as soon as practicable before transfer of title.” It’s vague, but all that means is that the buyer should get these disclosures as early in the home selling process as you can give them.
Some sellers ready the disclosure, the home inspection, and the paperwork so that it’s all ready for home buying. Others wait to talk to the potential buyers, before providing the disclosures and negotiating.
If you don’t give them the disclosures by the time you two have signed the agreement, then the home buyer can terminate the deal. If you’ve delivered the disclosure form, the deadline for cancellation is five days after delivery by electronic means or by snail mail or three days after the in-person delivery.
What Do I Need to Disclose?
California’s disclosure requirements are strict and thorough. There’s a format for these disclosures, called the “Transfer Disclosure Statement” (TDS). You must also complete the Natural Hazard Disclosure Report/Statement. You can get both from your real estate agent.
The TDS covers a broad range of disclosures. Here’s a list of some of the things you should take note of. Consult with a Calabasas real estate attorney for a complete list of disclosures to avoid future problems when selling a home.
- Deaths in the property in the last three years
- Appliances in the home (include those that come with the house sale as well as whether they are still working)
- Room additions
- Damage and repairs
- Health hazards
- Neighborhood noise problems
You will also need to certify that you’ve followed California laws regarding the property, like securing the water heater, or smoke detector requirements.
The Natural Hazard Disclosure Statement covers such topics as:
- Earthquake fault zone
- Flood hazard area
- Risk of forest fire
Consult with your local government for these classifications. A real estate lawyer can help you with these.
Some other additional disclosure statements may be required for things like purchase money liens or special study zones, depending on the location and the details of your transaction. Talk to your real estate attorney to know whether you need to make any of these disclosures.
Before you sell your house, you must also let the buyer know about registered sex offenders located in your area. You can find these online at the state-operated website, or from your local law enforcement agencies.
Of course, providing a complete list of disclosures is tedious and takes a lot of time and effort. This effort is a necessary part of selling a house. If a prospective buyer doesn’t receive a disclosure statement at all, then they could cancel the transaction even at the last minute of the negotiations. All the effort that went into your home sale would be wasted. Also, property buyers tend to be happier when you’ve told them upfront about these possible issues, improving the chances of sealing the deal.
Exemptions from disclosure requirements
Some transfers don’t need you to make these disclosures. Here’s a shortlist of these kinds of transactions:
- Foreclosure sales
- Court-ordered transfers
- Transfers by a fiduciary in the administration of a decedent’s estate, a guardianship, conservatorship, or trust
- Transfer from co-owner to another
- Transfer to spouse or close relatives
- Transfer from failing to pay tax
- Transfer to or from a governmental entity
Need help selling your house? Want to assess the fair market value of your home before selling your property? Get in touch with us at Moschetti Law Group. Contact our Calabasas real estate lawyers for a Consultation.