The cost of building a new home is out of reach for many people, especially with the recent economic crisis. You may be among those who prefer a brand new home because it means not having to deal with the issues a previous owner may leave behind. However, in most states, the law requires sellers to disclose certain facts about their homes to give buyers a chance to make informed decisions about their purchase.
Sellers have a difficult decision to make. By revealing the defects in the home, sellers run the risk of not getting the price they want. On the other hand, withholding information about defects of which they are aware is a violation of state law. You have the right to decide whether you are willing to purchase the house with its problems, negotiate for a lower price or walk away from the deal.
What the seller must tell you
A seller disclosure is a statement you should receive at some point after you make an offer on the property. There are some exceptions, such as if you are buying a home in which no one has ever lived, a home that is in foreclosure or a building you intend to demolish.
In Maryland, the seller also has the option of offering the property “as is,” which means the seller does not have to provide you with a disclosure statement or make any guarantees about the condition of the property beyond what is included in the sales contract. This may raise your suspicions, however, and cause you to wonder why the seller chooses not to reveal information about the home. Aside from an as-is sale, though, a seller should provide a form that indicates actual knowledge of the home’s elements, including:
- Foundation settlement
- Leaks or moisture in the roof or basement
- Defects in the walls or floors
- Plumbing, electrical, heating or air conditioning problems
- The condition of the septic system and water supply
- Evidence of termites or other pests
- The presence of asbestos, radon, lead paint or other hazards
- Zoning or land use violations, easements, or other property issues
- Flooding or problems with standing water after rain
- HOA restrictions
- Other defects that materially affect the condition or use of the property
These disclosures are not the same as a home inspection, and obtaining an inspection is a step you should not skip no matter how thorough your seller’s disclosure may be. Nevertheless, if the previous owner fails to disclose material defects in the home that leave you with costly repairs or a home that is unlivable, you may have cause to seek redress through the civil courts.