When buying a property, there are several procedures and documents involved so you must know what you are getting into to avoid any disappointments. You may already be familiar with some of the terms that would be used but some others would be entirely foreign. For the sake of this article, we would be looking closely at the seller's disclosure form (otherwise known as a property disclosure statement) and all that it entails.
A seller's disclosure form, as the name suggests, is a form completed by the seller of the property to provide full information on what they know about the property. This is a prerequisite for purchasing a property in the United States and each state has a specific format for its disclosure form. The purpose of this is to give the buyer good knowledge of the exterior and interior parts of the property. Depending on which side you are—the buyer or seller—there are certain things you need to know about the contents of a seller's disclosure form.
● The seller is required to obtain a seller disclosure form which could either in the format provided by the state or a blank form. It is preferable to obtain a State-specific form as this provides more details on the terms and conditions involved. These forms are available online and can be downloaded, filled, and signed in e-format.
● The form should be filled by the seller first before being sent to the buyer. If the buyer views it and accepts the liabilities involved, he/she would, therefore, append his/her signature on the form.
● The form should contain all the defects and any other information regarding the property in question. To avoid leaving out any vital information, the seller should inspect the property themselves before filling the form.
● Other essential details to be provided on the form are the duration of ownership, utilities available, sewage disposal system, fire prevention measures, location of the property, potential hazards, fittings, and fixtures. Providing all these details would help the buyer decide whether or not they want to take the risk of purchasing such property and prepare for any mishaps that may occur in the future owing to the state and/or location of the property.
● The disclosure form could be attached to a purchase agreement document as long as one is involved.
If a seller is not completely honest while filling a disclosure form, there could be consequences. A buyer may receive full refunds if they discover more defects that were not included in the disclosure form after making payment. As a buyer, you should carefully go through the completed form before signing on it. Sellers are also expected to carry full surveys on the property and if possible, with the help of an inspection agent. This would largely prevent arguments and complaints that result after purchasing a property and give the buyer an idea of how much they have to spend on repairs and installations before or after moving into the house.