I have been asked many times, “Why do I need a Seller’s Disclosure when it’s an “As Is” sale?”
For a seller in an “As Is” sale, they are still required to disclose any defects known to them even though they are selling the home in “As Is” condition. This does not ever release the seller from their obligation of disclosure required by law. This is why as a listing agent you must insist that your seller really thinks about their entire home when completing the Seller’s Disclosure. Don’t forget to remind them to remember to disclose those things that may have never worked since they moved in, for example: windows, electrical outlets and appliances. Many times a seller will forget these defects because they have lived with it, or never used the defective item.
A buyer purchasing a home in “As Is” condition should always expect a Seller’s Disclosure to understand any possible issues they may be purchasing. Keep in mind that in today’s market, many institutional or investor sellers will not complete a Seller’s Disclosures as they have not lived in or sometimes even seen the property. This does put a lot of risk on the buyer. So, when representing the buyer in any transaction especially in one where there is no seller disclosure, you must strongly advise the buyer to obtain a professional home inspection.
A home inspection is good for both the buyer and seller. For the buyer, it reveals possible issues and future maintenance items. For the seller, it will relieve some responsibility for defects they may not be aware of that could become an issue after the closing.
My belief is that there is no such thing as too much disclosure! The more that is on the table, the less that can come back later in possible litigation.
Posts in this category are compliance guidelines. Nikki is not an attorney nor is she giving legal advice.
Category: Nikki's Compliance Corner