RE/MAX Real Estate Guide and FAQ - Questions and Answers for Real Estate Sellers
RE/MAX Valley Real Estate, Boardman, Ohio

Real Estate Guide

Selling Your Home

 

RE/MAX Valley Real Estate

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RE/MAX
Valley  Real Estate
1006 Boardman - Canfield Rd.
Boardman. Ohio
(330) 629-9200

RE/MAX Real Estate FAQ - Selling Your Home, Residential Property Disclosure

Selling Your Home - Questions and Answers
'Residential Property Disclosure'

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Whose obligation is it to disclose pertinent information about a property?
In most states, it is the seller's, However, obligations to disclose information about a property vary form state to state.

Under the strictest laws, you and your REALTOR® are required to disclose all facts materially affecting the value or desirability of the property which are known  or accessible only to you. Judge may also include phrase, "should have known" in certain situations.) These might include facts such as:

  • homeowners association dues;
  • whether or not work done on the house meets local building codes and permits requirements;
  • the presence of any neighborhood nuisances or noises which a prospective buyer might not notice, such as a dog that barks every night or poor TV reception;
  • and any restrictions on the use of the property, such as zoning ordinances or association rules.
  • presence of any hidden defects such as mold behind walls, defective drainage, basement water intrusion. (See:  What defects do I have to disclose to the buyer?)

It is wise to check your state's disclosure rules prior to selling your home. Improper disclosure may allow your buyer to rescind the contract. The following discusses the Disclosure law as it applies to selling residential real estate in Ohio.

In Ohio, the Residential Disclosure Law  requires the seller of a home to disclose to possible buyers information pertaining to the visible (patent) and non-visible (latent) condition of the home. (Note that the law only applies to RESIDENTIAL property. Commercial property and unimproved land do not apply.) The information to be disclosed is prescribed by the Ohio Department of Commerce on a form called the Residential Property Disclosure Form. The seller must complete the form to the best of his knowledge, sign his/her name as to it's veracity, and date it. The buyer acknowledges receipt of the Form by also signing and dating it.

The Form should be provided to the buyer before executing a Purchase Contract. Ohio law provides no penalty to the Seller if the Form is given after the Buyer and Seller have entered into a contract, or even if the Form is never delivered; however, without a properly executed Residential Property Disclosure, the Buyer of the real property may have the right to rescind the Contract without prejudice even after entering into a bona fide contract with the seller.

If the form is delivered after executing a contract,  the Buyer then has 3 days to rescind the contract without penalty. Should the Seller simply not provide a Disclosure, the Buyer has 30 days from the execution date of the contract, or until escrow closes, whichever comes first, to rescind the contract without penalty. (Note: - once title to the property transfers the buyer cannot back out of the deal, with or without a Residential Property Disclosure.)

To fully understand the obligations and limitations of the Ohio Residential Property Disclosure Law,  you should consult with an attorney.

Resources >>

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What defects do I have to disclose to the buyer?
Disclosure laws vary by state, but in Ohio, the law requires the seller to complete an Ohio Residential Property Disclosure Form Here is a summary of the things you could expect to see in this disclosure form:
  • In the kitchen -- a range, oven, microwave, dishwasher, garbage disposal, trash compactor.
  • Safety features such as burglar and fire alarms, smoke detectors, sprinklers, security gate, window screens and intercom.
  • The presence of a TV antenna or satellite dish, carport or garage, automatic garage door opener, rain gutters, sump pump.
  • Amenities such as a pool or spa, patio or deck, built-in barbeque and fireplaces.
  • Type of heating, condition of electrical wiring, gas supply and presence of any external power source, such as solar panels.
  • The type of water heater, water supply, sewer system or septic tank also should be disclosed.

Sellers may be required to indicate any significant defects or malfunctions existing or cured within the past 5 years in the following checklist of a home's major systems >>

  • interior and exterior walls
  • ceilings
  • roof
  • insulation
  • windows and doors
  • driveway and sidewalks
  • floors
  • foundation
  • electrical and plumbing systems

The form also asks sellers to note >>

  • environmental hazards (radon, asbestos, etc.)
  • walls or fences shared with adjoining landowners
  • any encroachments or easements
  • room additions or repairs made without the necessary permits or not in compliance with building codes
  • zoning violations
  • citations against the property
  • lis pendens, lawsuits pending against the seller affecting the property

Also look for, or ask about, settling, sliding or soil problems, flooding or poor drainage problems and any major damage resulting from earthquakes, floods or landslides.

People buying a condominium must be told about covenants, codes and restrictions (CC&R's) or other deed restrictions.

It's important to note that the simple idea of disclosing defects has broadened significantly in recent years. Many jurisdictions have their own mandated disclosure forms as do many brokers and agents. Also, the home inspection and home warranty industries have grown

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Should I Get Home Inspection Before I Make My Property Disclosure?
RE/MAX Valley Real Estate recommends that you do. It can give you a huge advantage during negotiations. Here's why:
  • A disclosure statement that is backed by a recent inspection report made by a certified home inspector sends the message to the buyer that you are hiding nothing and, in fact, have gone out of your way to disclose everything about your property's condition. This is a confidence builder. One that may allow him to make a more generous offer than if he had concerns either with the house or your honesty.
  • An inspection conducted prior to listing and marketing your home allows you to get all the little things done first - the things that are remedied easily and inexpensively - but add up quickly in the buyer's mind to far too much effort and too much money. The buyer will always double the time, effort, and cost of a repair.
  • In recent years the buyer's home inspection has come to be known as round two of negotiations when the buyer hands the seller a 'wish list' of repairs and/or price deductions to be made a condition of the sale.  With a pre-listing home inspection you can take away that advantage and sell your house 'as-is.'

    If the true condition of your house is known beforehand, then you can make the case that a buyer's initial offer and, ultimately, the agreed upon  price will have taken all your disclosures into account and there will be no need for any further negotiations. A buyer will be more likely to accept a defect 'as-is' if he knows about it going in, rather than finding out about it through his own home inspection.

  • Finally, doing a pre-listing inspection report can reduce or even eliminate any  liability should a latent material defect be  found after the property transfers. You can far more easily show that you had no prior knowledge of the recently detected defect and no attempt was made to hide it, or any other defect, from the buyers. You've just made a case that is difficult to prove under any circumstance, extremely easy to defend now.

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What repairs should the seller make?
If you want to get top dollar for your property, you probably need to make all minor repairs and selected major repairs before going on the market.

Nearly all purchase contracts include an inspection clause, a buyer contingency that allows a buyer to back out if numerous defects are found or negotiate their repair.

The trick is not to overspend on pre-sale repairs, especially if there are few houses on the market and many buyers (sellers' market) willing to buy at almost any price. On the other hand, making such repairs may be the only way to sell your house in a down market (buyers' market).

During a prospective buyer's inspection, environmental hazards may be uncovered, such as radon gas coming from the basement, or asbestos covered water pipes, peeling lead based paint, leaking in-ground oil tanks, or mold in the basement or attic. These are conditions that the buyer or mortgage lender will probably want repaired before allowing the purchase to close.

If you think your home may be at risk for one or more of these hazards, have your own home inspected even if you not considering selling. Your health may be at just as much risk as the value of your property.

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Can I be held liable for failing to disclose that a murder or suicide took place on my property?
If a murder or suicide took place at your home, the stigma of the occurrence to some buyers may make it psychologically impossible for them to buy the property. Even if a particular buyer may not care about any so called stigma, it may make it very difficult to resell the property in the future.

Some state laws explicitly relieve the seller, salesperson or broker of the obligation to disclose certain property stigmas. Therefore, you must check carefully within the jurisdiction in which you live for the disclosures laws that apply.

Ohio has no statutes covering so-called stigmatized property. A seller simply has an obligation to disclose any known latent defects or other material fact that may affect the buyers decision to purchase the property.

A murder or suicide probably would not effect the physical condition of the property and, therefore, would not constitute a latent defect. However, a murder or suicide could potentially be considered a material fact to some buyers. Therefore, to avoid the possibility for a claim against you in the future, it may be advisable for you to err on the side of caution and to disclose the fact of a murder or suicide in your home to a serious or likely buyer.

Note: This information should not be relied upon as legal guidance. Both the relevant laws and legal counsel should be consulted. This information should not be construed as specific legal advice nor as an opinion on particular facts, cases, or situations.

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Do I have to disclose the fact that I'm HIV positive?
No. Persons with AIDS or who are HIV positive are protected under federal fair housing laws. The U.S. Department of Housing and Urban Development has declared it illegal to disclose that the current or former occupant of a property had AIDS or was HIV positive.

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Do I have to disclose that a previous inspection revealed a defect?
In Ohio, yes. The Division of Real Estate has taken the position that negative inspection reports are material facts and must be disclosed to subsequent buyers even if you obtain other reports to contradict those findings or you question their accuracy. In addition,  if your agent has knowledge of the negative report, the Division of Real Estate demands that he or she must disclose that fact to subsequent buyers even if you decide not to amend your form.

We would suggest that you disclose the negative report to subsequent buyers, but also attach to the form any contradictory reports and/or reasons why you refute the negative report.

It is strongly recommended that you seek legal advice if you have any questions regarding your duty of disclosure and whether to amend the form.

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If the property condition changes after I have given the Disclosure Form to a buyer, am I required to fill out a new form?
The Disclosure Law in Ohio says the seller "may" amend the disclosure form in this situation, but does not require you to do so. If you do provide a buyer with an amended form after you enter into a purchase contract, the buyer then has three (3) business days from the date he received your amended form to rescind the contract.

For this reason, and because of the seller's obligation to disclose latent defects, it is strongly recommended that you seek legal advice if you have any questions regarding your obligation to disclose and whether to provide an amended form.

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I'm a FSBO - does the Ohio Disclosure Law apply to me?
The statute provides that a form must be given to any prospective purchaser of "residential real property'. Anyone selling residential real property must provide the form whether they are being represented by a REALTOR or selling the home on their own. For the purposes of the law, residential real property is defined as "real property that is improved by a building or other structure with one to four dwelling units."

As a FSBO we remind you that you are also required to present the Lead Based Disclosure Form and Pamphlet to all prospective purchasers as prescribed by the EPA and HUD. A RE/MAX Valley REALTOR will be happy to supply these forms for you as a service.

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Will a neighbor problem reduce the value of my property?
See Real Estate Guide (Home Owners) -  Will a neighbor problem reduce the value of my property?

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What about Lead Based Paint?
The Environmental Protection Agency (EPA) and the Department of Housing and Urban Development (HUD) mandate that the public receive a Lead Paint Disclosure Form containing information necessary to prevent lead poisoning in homes that may contain lead-based paint hazards. According to the law, all home buyers and renters will receive known information on lead-based paint and lead-based paint hazards during sales and rentals of housing built before 1978. Buyers and renters will receive specific information on lead-based paint in the housing as well as a Federal pamphlet with practical, low-cost tips on identifying and controlling lead-based paint hazards.

Sellers and landlords as well as their agents will be responsible for providing this information to the buyer or renter before sale or lease.

Transactions covered:

  • The sale or lease of housing constructed prior to 1978 whether for sale or lease
     

Transactions not covered:

  • Foreclosure sale
  • Leasing of rental properties that have been found to be lead-based paint free by a certified inspector
  • Short-term leases of 100 days or less, where no lease renewal or extension can occur
  • Lease renewals where lead disclosure has already taken place and no subsequent testing or information has become available
  • Housing for the elderly or disabled, unless a child under the age of 6 resides, or is expected to reside, in the housing
  • 0-bedroom dwellings where the sleeping area is not separated from the living area
     

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Do I need an attorney when I sell a house?
In Ohio, settlement and escrow are overseen by an officer of the court, usually an attorney.  However, most home owners along with their REALTOR® are capable of handling routine real estate purchase contracts as long as they make certain they read the fine print and understand all the terms of the contract.

In particular, you should be clear on the terms of any contingency clauses that will allow buyers to back out of the contract. You should also be very clear on your duty to disclose pertinent conditions of your property. If you have any questions at all concerning these matters, it is strongly recommended that you consult an attorney to avoid future legal entanglements.

See Seller Legal Issues - 7 Purchase Contract Items To Watch Out For

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What are the standard contingencies?
See Real Estate Guide: Selling Your Home (Purchase Contract, Escrow and Closing) - Standard Contingencies?
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Do sellers have to disclose the terms of other offers?
See Real Estate Guide: Selling Your Home (Purchase Contract, Escrow and Closing) - Do sellers have to disclose terms?

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