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California Home Sellers Need to Provide These Disclosure Statements and Reports to Buyers

Updated on April 4, 2015
MarleneB profile image

Marlene is a California real estate broker/REALTOR®, selling property since 1989. California Bureau of Real Estate License #01056418.

Sellers need to give disclosure documents to buyers before transferring title.
Sellers need to give disclosure documents to buyers before transferring title. | Source

Real Estate Credentials

I started selling real estate in 1989. While I am retired from actively serving buyers and sellers, I still maintain a California broker’s license. In the many years that I sold real estate, one thing that was most important to me was that sellers disclose everything they believe to be true about the house they are selling. I would ask sellers to think about and disclose any issue that, potentially, could affect the new homeowner’s peaceful enjoyment of the house. This could mean letting buyers know about noisy neighbors, barking dogs, and anything that could be perceived as a nuisance to the new owner.

Disclaimer

The information provided applies to California state properties. The reader must investigate or ask a local real estate agent to provide reliable information about disclosure laws in the appropriate state of interest.

While the author believes the California information is reliable, the reader is encouraged to consult with his or her own real estate agent for verification.

Disclosure Example

I had a client who had a two-story house with one bathroom upstairs and a bathroom downstairs. This configuration requires a plumbing system that connects the upper bathroom and lower bathrooms to the sewage systems. Because of an earthquake, the homeowner inspected underneath the house for any damage and discovered that the sewage pipe from the upper bathroom to the lower bathroom had cracked and leaked some sewage. The homeowner repaired the cracked pipe using some elastic sealing tape. Even though this took care of the problem, I advised the homeowner to disclose the repair, because a buyer would want to know this. The pipe may need to be replaced in the future. A buyer with this kind of knowledge would be in a better position to understand the situation and do a proper procedure on any future repairs.

California Has Stringent Disclosure Requirements

California is one of the most litigious states known in the 50 contiguous states. It is no wonder that California has extremely stringent disclosure requirements. Knowing your rights and the rights of others may avoid, or at minimum, reduce the negative impact of a lawsuit.

In California, there are 25+ disclosure requirements that are typical for most 1 to 4 unit, single family sales transactions. Before selling a house, the seller is required to disclose material facts about the house. This means that everything the seller knows about the house’s structure and neighborhood should be disclosed to the buyer.

If you think a buyer would want to know it… disclose it.

— Marlene Bertrand, Real Estate Broker

Some sellers, such as executors of deceased owners, are exempt from providing disclosure statements. Since it is likely executors have not lived in the house, it is presumed executors do not have knowledge of the house's condition. Still, it is wise to inform buyers of any facts known about the house.

The following table is a list of California disclosure requirements.

Common Disclosure Forms Needed to Sell a House

Name of Form
When the Form is Used
Agency Disclosure and Agency Confirmation
To clarify the relationship between the seller and agent.
The Transfer Disclosure Statement
To disclose the condition of the property.
Seller Property Questionnaire
This is an additional form used for additional information about the property. Used to help trigger the seller's memory of living on the property.
Smoke Detectors
To declare that the house is fitted with the proper number of working smoke detectors.
Heater Bracing
To declare that the water heater is braced.
Carbon Monoxide Detector Disclosure & Compliance
To declare that the house is in compliance and fitted with a carbon minoxide detector.
The Visual Inspection
For the agent to declare his or her findings during a visual inspection of the property.
Natural Hazard Zones
To disclose which, if any, hazard zones the property resides in or near.
Natural Hazard Disclosure Statement
To provide additional declarations about hazard zones.
Mello-Roos Taxes and 1915 Bond Act Assessments
To declare whether or not the property is subject to Mello-Roos Taxes bond assessments.
Former Military Ordinance Location
To disclose whether or not the property is in or near a former military ordinance location.
Industrial Use Zoning
To disclose whether or not the property is in or near an area zoned for industrial use.
Supplemental Property Tax Bill
To disclose that the buyer may receive an additional property tax bill after the sale is complete.
Informational Booklets and Form FLD
To provide additional informational booklets regarding homeowner safety.
The Homeowners Guide to Earthquake Safety Booklet
This booklet is required to be given to the buyer. It is used to provide information about how to be safe in an earthquake.
The Commercial Property Owner's Guide to Earthquake Safety
This booklet is required to be given to the buyer. It is used to be safe in an earthquake. For commercial buyers.
Residential Earthquake Hazards Report
This booklet is required to be given to the buyer. It is used to provide information about earthquakes and to disclose the property's proximity to earthquakes.
The Lead-Based Paint Pamphlet and Form FLD
This booklet is required to be given to the buyer. It is used to provide information about lead-based paint.
The Residential Environmental Hazards Booklet
This booklet is required to be given to the buyer. It is used to provide information about certain environmental hazards.
The Home Energy Rating system (HERS) Booklet
This booklet is required to be given to the buyer. It is used to provide information about the Home Energy Rating system.
Lab Activity
To provide information about whether or not there is lab activity in or near the property, in particular, meth lab activity.
Registered Sex Offenders
To provide information about the property's proximity to registered sex offenders.
Toxic Mold
To provide information about actual or potential toxic mold.
Material Facts
To provide any additional facts that a buyer would want to be aware of.
Death of an Occupant
If a death occurred on the property within the last three years, the seller must disclose this information to provide known details to the buyer.
Property Transfer Fee
To declare the rate and amount of the cost of treansferring the property from the seller to the buyer.
Contractual Disclosures
To disclose a mixture of disclosures pertaining to the contract.
Local Ordinance Disclosures
To disclose any local ordinances mandated by the city and county.
Illegal Disclosures
To disclose of any known illegal activity on or near the property.
Estimated Sellers Proceeds
To show the seller the amount of funds estimated to be received when the property is sold.
Seller's Advisory
To advise the seller of their obligations in the transaction.
Most states, especially California, require sellers to provide disclosures to buyers. Sellers should talk to their real estate agent to assure they are in compliance with these requirements.

Disclosure Requirements Vary

Although reliable, this list of documents is not all-inclusive. Every real estate sales transaction requires a unique set of documents that are specific to that particular transaction as it relates to that particular buyer and seller on the date and time of execution.

Sellers should seek the advice of a competent real estate advisor or real estate attorney to assure they fulfill their disclosure obligations.

"Real estate information; clear and simple!"

Marlene Bertrand is a Broker/REALTOR®.

Calif. Bureau of Real Estate Lic. #01056418.

© 2015 Marlene Bertrand

Comments

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    • MarleneB profile imageAUTHOR

      Marlene Bertrand 

      3 years ago from USA

      Hi ChitrangadaSharan. Thank you for your feedback and support. California does have a lot of disclosures. There is no doubt that other areas, like where you live, have a lot of disclosures too. It's all about letting buyers know what they are "really" buying.

    • MarleneB profile imageAUTHOR

      Marlene Bertrand 

      3 years ago from USA

      Hi Ericdierker. I know some people would think it is overkill, but when I put myself in the place of the buyer, these are all things I would certainly want to know before buying a home. Making such disclosures mandatory just makes it easy to get important information to buyers.

    • ChitrangadaSharan profile image

      Chitrangada Sharan 

      3 years ago from New Delhi, India

      Great information about real estate rules for home sellers and buyers in California. Some of the rules you mentioned above, are the same here in India as well.

      Thanks for sharing this useful information! Voted up!

    • Ericdierker profile image

      Eric Dierker 

      3 years ago from Spring Valley, CA. U.S.A.

      Great article on disclosures. It really makes one stop and think. As I read through them I could not help but think that the whole requirement thing is just a codification of being honest about a house.

    • MarleneB profile imageAUTHOR

      Marlene Bertrand 

      3 years ago from USA

      Hello poetryman6969. Yes, California wants you to tell all... If there is a sex offender living in the neighborhood, the buyer has a right to know. Privacy goes out the window here. But, the relief for the seller is that the seller isn't required to name names. The seller is only required to provide information that they KNOW. The state realizes that the seller can't always know when an offender lives in the neighborhood, so at minimum, the seller must present a document that gives buyers information about where they can go to get that information.

    • poetryman6969 profile image

      poetryman6969 

      3 years ago

      Proximity to registered sex offenders! Since I don't have children, that's something I probably don't even want to know but you have to disclose it to the buyer?

      We were thinking about moving to California but between the drought and the drag of disclosing stuff I myself don't want to know about if I happen to buy and then sell a house it does give one pause.

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