The Importance of a Texas Sellers Disclosure

Did you know… the sellers disclosure is a document that allows the seller to provide information regarding the property condition? This form is provides information on home owner associations, utilities, mechanical (a/c, appliances, water heater, etc;, previous wood destroying insects, and most important; structural knowledge. If a property has ever been in a fire, had previous treatment/repair for wood destroying insects, or if a death occurred because of the property condition, the seller should disclose this information on this form. Both sellers and buyers must sign this form and acknowledge receipt of it. Of course, there are some sellers that are not required to submit this form, with the typical caveat being if the seller has never resided in the home – but not all are exempt. Check with your REALTOR® or real estate attorney to verify if one is required of the seller.

Sellers: Caution should be used when filling this form out. If one is not sure whether the property has a specific item, such as a French drain, one should take care in answering this correctly. The options on the Seller Disclosure include, “Yes, No, Unknown.” There are also spaces available to write information that needs more detail. Remember, if you state that the property has a full sprinkler system (front and back yard), and the property only has a sprinkler system in the front yard, you may find yourself installing a sprinkler system to comply what you have disclosed. One is always better of disclosing a material fact. If a seller knows the property’s foundation has been leveled, the property has had fire damage, termite repairs, previous flooding, mold issues… DISCLOSE, DISCLOSE, DISCLOSE. One does not want to be found in litigation over failure to disclose a material fact. A material fact in real estate is one that would cause an individual to change their mind regarding the purchase of the property. How would you feel if you purchased a property which you decided to renovate, only to discover that there was mold, a fire or termite damaged frame, or a shifting foundation? Yes, these are material facts!

Buyers: Never sign the Sellers Disclosure form, unless you accept the property conditions stated from the seller. Of course, there are always the unknown factors, which is why one should always get the property inspected by a licensed third party inspector. Keep in mind this form is regarding the “sellers knowledge of property condition.” Questions within this form ask if “seller is aware” of specific items being in need of repair, therefore, the seller may not know about a roof or water heater needing repairs, or if a room addition was done without permits (if the previous owner made the additions). You should have a copy of this disclosure and submit a signed copy with your offer. If major repairs have been done, such a foundation leveling, it is best to inquire about transferable warranties and receive copies of these warranties with the disclosure.

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