- Personal Finance
How Insisting On Disclosure Can Save You Money & Grief Part 2
Seller Property Disclosure
Once you have a good buyer agent, one of his jobs will be to help you look over the seller's property disclosure on the general condition of the house. It should acknowledge whether the roof leaks or the basement gets wet. It may discuss the age of appliances. It should reveal things such as termites. For the smart home buyer, however, seller disclosure is the first word on a home's condition, not the last. It's not unusual for sellers to gloss over certain problems, "forget" to mention others or even lie.
Which brings us to home inspectors, the people you pay to go through the house and make sure it's sound. The most important thing about hiring an inspector, however, is his credentials. Is he an engineer? A builder? Does he adhere to regional Society of Home Inspectors standards? Is he insured?
What happens if he misses something? (It happens.) Many inspectors will only give you your money back if they blow the inspection, a couple of hundred bucks. But you could be left with thousands in roof repairs that, had you known about them, might have changed your mind about buying the house. So, be blunt. Ask the inspector about his guarantee.
Don't Forget the Neighbors
Another interesting (and sometimes accurate) source of information is the neighbors. If you're serious about a property, knock on a couple of doors, introduce yourself as a potential buyer and ask questions. You might find out the neighbor on the other side mows his backyard in the nude (that's happened, too) or the guy across the street revs his Harley every morning at 5 o'clock. They might even reveal things about the house, such as why it's for sale or any structural problems the seller has complained about. Like everything else, don't take their word as gospel but know that it all helps in the information-gathering process.
Good lawyers make for good contracts. The best protection any buyer can have is a well-written contract, especially when it comes to property disclosure. Attorneys should make the disclosure form part of the actual purchase contract. A lot of times, if the disclosure is not part of the contract, the seller may only be liable for whatever repairs it takes to make a problem right. But if your attorney makes the disclosure part of the contract, you may be able to rescind the entire deal and get your money back.
- Make sure the seller's disclosure is current to the day of close. A property disclosure that was filled out three months ago may not reflect current conditions.
- Ask for more than the form asks. Ask sellers to disclose any adverse conditions in the future: Is there road widening planned? Is there a new development planned nearby? Is the new runway at the airport going to send planes over your house?
- Let it be known that you are relying on the seller's statements. Make it clear to the seller, his agent, his lawyer and everyone else that the disclosure statement is a major part of your decision-making process. If you end up in court later, those statements could strengthen your case.