A Word about Full Disclosure
Legal decisions, legislation & common sense dictates that a seller has a responsibility to reveal to you the true conditions of the property. Selling a property w/out disclosure, or forcing the buyer to assume all responsibility for determining the property condition, isn’t acceptable in the marketplace. A seller must disclose the known defects of the property to the buyer. This information should be made available to the buyer as soon as possible.
Charm or Irritant?
If the seller has lived in the property, the Seller has first hand & intamite knowledge of the true condition of the home and anything that can affect the property. But for the Buyer, these pecuilarites may be more than a mere inconvience, and may in fact be an irritant to the Buyer. It’s important for the Seller to review the condition of the property with the Realtor & make note of any conditions on the Disclosure Statement. Civil code section 1102 requires that the seller provide the Buyer with a completed Real Estate Transfer Disclosure Statement.
All Systems A Go
A basic assumption in every sale is that the home and the systems in the house are functional. For example- the roof will hold out the rain and sun, the hot water heater will provide hot water, and the heater will provide heat. If it is known that any of the systems do not function properly, such facts should be included in the disclosure statements and acknowledged by the buyer.
An “as-is” purchase contract is perfectly acceptable only as long as the Buyer understands exactly what the “as-is” condition entails. Thus it can be said in the Purchase Agreement that the Buyer accepts the home and its systems in their present condition and relies on the truth and reliability of the disclosure statements and that unknown conditions may exist. This acknowledgement provides a defense for the seller if it is later claimed the problems were not disclosed.
The Seller must disclose any knowledge of environmental hazards such as asbestos or pollutants in the home or on the property. The buyer will be provided with a Real Estate Transfer Disclosure Statement, in which the seller declares their knowledge on this subject.
Personal VS. Real Property
The distinction between personal and real property can be a source of difficulty in real estate transactions. A Purchase Contract is normally written to include all real property, that is, all aspects of the property that are affixed down or an integral part of the structure. For example, this includes wall light fixtures, chandeliers, curtains, drapes, tree’s and shrubs. It would not normally include refrigerators, washer/dryers, micorwaves, or bookcases. If there is any uncertainty about whether an item is included in the sale or not, it is best to include and mention that item in the Purchase Agreement as included or excluded.