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What You Need to Disclose When Selling Your Home


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Editor’s Note: This story originally appeared on Point2.

When selling your home, it’s in your best interest to make it sound as appealing as possible. But while disclosing its faults might sound counterintuitive, it is, in fact, an essential step.

Indeed, there are several things that you’re required by law to disclose to potential buyers, and failure to do so can have serious repercussions.

As a seller, omitting to reveal certain information can result in fines, lawsuits, and, in the worst-case scenario, even jail time. Providing full disclosure can protect both the seller and buyer.

On top of that, a seller willing to be honest about their home is far more trustworthy.

So, what do you need to disclose to the buyer when selling your home? In this guide, we’ll take a look at the essentials.

Understanding Your Local Disclosure Laws

Woman doing taxes business planning
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When it comes to seller disclosures, there is no one-size-fits-all. While many things are commonplace no matter where you are, the specific disclosure laws differ depending on your location.

You can typically obtain these laws from your local real estate planning department, although it’s often quicker and easier to consult a real estate lawyer instead.

But even though the specifics vary by area, the following seller disclosures are standard throughout Canada and the U.S.

1. Structural Problems

A crack in the wall of a home
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No home is perfect, and many will require some form of renovation, either before you sell it or once the new owner takes over.

However, while cosmetic issues are expected, more severe structural defects must almost always be disclosed before the sale can be completed.

Cracked foundations, sagging roofs, and electrical or plumbing faults are just some of the more serious problems that typically need to be revealed by the seller. In many cases, sellers are only required to disclose the defects they’re aware of.

However, in some locations, the seller is required to have a full survey carried out and the results must be disclosed to potential buyers. So, as always, be sure to check the specifics before you proceed.

2. Former Renovations and Repairs

Worker renovating a home
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Any large-scale renovations or expansions that have altered the footprint of your home should be disclosed, as well as major remedial work on structural elements, such as a new roof or foundation repairs. This is especially important for issues that require regular maintenance or that might recur in the future.

It’s also important in some locations to provide proof that any works carried out in the past were done so legally and had all of the required permits.

Of course, smaller fixes or redecorating jobs don’t usually need to be disclosed, though it might be in your best interest to let buyers know that you’ve spent time upgrading your home.

As always, laws differ widely by area. For example, previous renovations don’t need to be disclosed by law in several parts of Canada.

3. Issues Caused by Water Damage

A house in Houston suburb flooded from Hurricane Harvey 2017
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Water damage can severely compromise the structural integrity of a building, as well as cause a health hazard when mold grows.

So, in some locations, particularly those prone to flooding, sellers are required to disclose any previous or ongoing leaks or other causes of water damage.

Such issues may not always be seen during the inspection or walk-through, particularly if dry weather conceals a leaky roof or basement.

As such, it’s down to the seller to disclose this information, which might otherwise be impossible for the buyer to discover until it’s too late.

4. Pests and Infestations

rats rodents
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All known issues with pests must be made known according to disclosure laws in much of Canada and the U.S. What constitutes a pest can vary by location but typically includes:

  • Mice
  • Rats
  • Snakes
  • Termites (and other wood-destroying insects)
  • Ants
  • Bats
  • Hornets
  • Bedbugs
  • Roaches

In most cases, you’ll only be required to disclose active infestations, but once again, in some locations, you may need to provide a complete history of prior infestations and how they were dealt with.

Besides living pests, invasive plants such as Japanese knotweed or running bamboo should also be disclosed.

5. Dangerous Materials

Inspector
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Hazardous materials are surprisingly commonplace in homes across the U.S. and Canada.

Fortunately, they’ll rarely cause an issue unless disturbed, but as a seller, if you know that your home contains toxic building materials, you must inform the buyer. Some of the most common hazardous materials include:

  • Lead-based paint
  • Asbestos
  • Radon
  • Urea-formaldehyde

In some cases, certain types of mold must also be disclosed, since they’re just as hazardous to health as toxic building materials.

6. Environmental Issues & Off-Site Hazards

Two tornadoes strike in northern Oklahoma farmyards near Cherokee.
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Environmental risks, such as floods, earthquakes, tornadoes and wildfires, should always be disclosed. Not only that, but buyers should also be informed of any planned environmental changes in the vicinity that may impact them.

This includes things like a new highway or rail line being built nearby that may result in noise and air pollution.

Other off-site hazards worth mentioning are things like flight paths or public amenities, such as a power station.

7. Troublesome Neighbors

A man peeks over his fence
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Ongoing disputes with neighbors should also be disclosed, such as boundary disagreements or noise complaints.

Sellers in high-crime areas should explicitly disclose any safety concerns in the vicinity of the property they’re selling, particularly if a neighbor is a convicted criminal.

8. HOA Information

HOA
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If your home is governed by a homeowners association (HOA), this must also be disclosed.

Be sure to bring the buyer up to date regarding new rules and regulations, and if possible, try to provide minutes from any recent HOA meetings.

9. Violent Crime or Death in the Home

generic police cars rain
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Known as “emotional defects” in some areas, sellers are generally required to inform the buyer if the property was the scene of a murder, violent crime or suicide. Again, legislation varies depending on the location.

Natural deaths don’t typically need to be disclosed, but in some areas, if you believe your home is haunted, you’ll be required to let the buyer know.

Meanwhile, deaths caused by the condition of the property may need to be disclosed, even if the issue has since been rectified. This may include the drowning of a previous occupant in a pool that didn’t have a safety fence, for example.

10. Zoning Issues

Historic homes in Columbus, Ohio
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If your home is in a particular historic district, you must inform the buyer beforehand. This is because any plans to carry out repairs or renovations may not always be possible or can be prohibitively expensive in some historic areas due to local restrictions.

Other zoning issues, as well as ongoing problems with boundaries and easements, should also be disclosed by the seller.

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