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As a seller, you have an obligation to disclose
certain pertinent facts and information to a prospective buyer.
Though the requirements will vary from state to state, most sellers are
required to share with the buyer any information you know about the
property or information that you should know about the property that any
reasonable home owner would know. The purpose for disclosure is
two-fold. First, disclosure protects the buyer from buying a
property that he or she would reasonably not want to purchase and
second, disclosure provides a defense for a seller if a buyer sues in
court.
The information you should or may have to disclose
includes:
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Defects in the home. This may include,
though it is not limited to, settling problems with the foundation,
missing shingles from the roof, the pigeon nest in the attic, etc.
-
Condition of the home. This may include the
age and condition of the major appliances throughout the home (i.e.
HVAC, water heater, etc.), the type of plumbing in the home, the type
of electrical wiring, the type of construction materials used
throughout the home, etc.
-
Any past issues you may have had with the home.
This may include a water leak that was repaired 2 years ago, the fact
you replaced the hot water heater last week, the fact that you had the
home treated for termites when you purchased it, etc.
-
Any material information about the neighborhood
or surrounding area that you should be aware of. Examples
include disclosing any planned road construction in the area, the fact
that your home is in the noise contours of the local airport,
information about EPA or state superfund sites, etc.
Other information that you must or may want to
disclose includes:
-
Homes built prior to 1978 must include a lead
based paint disclosure. In addition to the disclosure, the
seller must include a pamphlet published by the EPA, "Protect Your
Family From Lead in the Home". You can download a sample lead
based paint disclosure by
clicking here.
The pamphlet can be downloaded by
clicking here.
It is important to note that Federal law requires sellers to give the
home buyer a minimum of 10 days to have the property inspected for
lead based paint. Also, if you have any paint assessments or
inspections, you must provide the buyer with a copy of this
information.
-
Information regarding your Home Owner's
Association. This may include the current Covenants, Conditions,
and Restrictions (CC&R's), Articles of Incorporation, by laws and
other governing documents, a current financial statement including a
reserve statement and budget, and any information regarding any
existing or pending special assessments, claims or litigation.
-
Information about pool safety and pool barrier
regulations. With so many children falling victim to drowning
and near drowning, disclosing the existence of State and local pool
barrier regulations is important. You can download a copy of the
Arizona's pool barrier information by
clicking here.
There are facts that you do not have to disclose in
Arizona. This includes
-
the site of a natural death, homicide, suicide
-
the site of a crime classified as a felony
-
whether the owner or an occupant who has been
exposed to HIV, diagnosed as having AIDS or any other disease not
known to be transmitted through common occupancy
-
being in the vicinity, area or neighborhood of a
sex offender
Arizona law does not protect a seller who makes
intentional misrepresentations. As a seller, if a buyer asks you
about specific information about the property, you have the duty to
disclose the answer, regardless if you consider it important or not.
If you are asked about one of the four disclosure exclusions listed
above, you should not answer "No" or "I do not know." Rather, you
should answer truthfully or respond that you are not legally required
to answer the question.
As a seller, you will want to disclose all related
information to the buyer in a written document. A sample seller
property disclosure statement can be downloaded by
clicking here. Have
the buyer sign the disclosure and keep a copy for your records showing
that the buyer acknowledged receipt of the disclosure. Also,
include copies of any documentation or paperwork that may be useful.
Items may include copies of building permits for the garage addition,
copies of invoices for the new hot water heater, or a copy of the 10
year roof warranty that still has 4 years remaining.
Furthermore, encourage your buyer to have the home
inspected by an independent, licensed home inspector. The
inspector should make a reasonable effort to examine the conditions of
the property and provide a written documentation to the buyer (and
possibly the seller) about the items inspected. In some
cases, a seller may want to order a home inspection before putting the
home on the market. This action may help identify any repairs that
need to be addressed by the seller as well as serving as an additional
document the seller may use to disclose the condition of the property.
(In Phoenix, a home inspection will generally cost from $200 and up).
Another step a seller should take is to offer the
buyer a directory of resources and information for his or her
independent review. One such example is Sun National Real Estate's
buyer advisory. As a Realtor, I have my prospective buyers review
this document with me and sign it as a way of showing that we discussed
relevant area information. You can download and use this advisory
by clicking here.
Though a seller is never fully relieved of the
liability of having to disclose information about the home, taking the
proper steps to make sure that the buyer has as much information as
possible is a step in the right direction. Disclosing protects
you, the seller, from having the buyer come back months or years after
the transaction closed and demanding that you correct a deficiency in
the home.
For more information on disclosure in Arizona,
visit the Arizona Department of Real Estate's website at
http://www.re.state.az.us
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