Real estate disclosures and its importance

The biggest concern on a buyer’s mind, when buying a property (especially a property that was built long ago) is the signs of deterioration, wear and tear, and other defects in the property. Being a seller, you must be able to do something about these concerns, to get your property sold in no time. Preparing a detailed disclosure document is one way of doing it. Real estate Disclosures are prepared by owners for buyers, stating the defects in a precise manner. Such disclosures are more than an honest gesture that you can choose or refuse; in many developed countries the real estate laws have made it obligatory for the sellers to disclose all sorts of faults and defects. However, such laws are hard to implement, mostly because there are no certain guidelines as to what kind of defects must be disclosed. For example, some laws state that the seller must disclose all of the known problems, at times it can be hard to determine what comes under this definition and what doesn’t.
Irrespective of the laws and regulations, you should be honest when making a disclosure report. It’s better to disclose the defects and settle on a relatively lesser price than deceitfully selling on a higher price and going through legal proceedings initiated by the buyer (after he/she discovers a major defect which was not mentioned in the disclosure). In case, this discovery is made prior to the closing of deal, you’ll have to return all payments made by the buyer (and in some cases bear the legal expenses, as well). That’s why you must be fully aware of local laws concerning real estate disclosures. The disclosure becomes an absolute must if there are health-hazards present at the property (e.g. the presence of radon gas).
A standard real estate disclosure make known the general defects like water leakages, a problem in plumbing or electrical system. One can also get plenty of real estate disclosure forms online for reference. As a general rule, you should state all problems in a clear and precise manner along with the steps you’ve taken so far and the possible fixes (though it is not necessary). In case, you’re a buyer, you shouldn’t rely solely on the disclosure to judge the overall condition of property. Hire a professional home inspector and have the property checked by an expert. Even if the seller is an honest individual, he/she may not be aware of a defect himself, hence you cannot hold them responsible for the negligence later on.