Let’s be honest, when it comes to home buying, it’s not unusual for typical homebuyers to get lost in all the paperwork. But within that flurry of papers is one set of documents that should never be taken lightly—the Residential Property Seller Disclosure Statement.
The Iowa Code requires sellers of residential real estate to provide prospective buyers written disclosure statements revealing the condition of several key aspects of the property’s characteristics and structure. Sellers that fail to disclose issues and defects they’re aware of, or which could be revealed through a reasonable inspection of the property, can be held responsible for the replacement and repair costs it takes to remedy the problem(s).
This is a relatively new development, as the old adage of “buyer beware” traditionally governed the transactional relationship. However, by compelling sellers to reveal a property’s known or discoverable defects, the disclosure model makes it much easier for buyers to actually beware.
Although the exchange and review of seller’s disclosures should be a fairly straightforward step in the home buying process, many folks merely skim through or overlook them entirely. This kind of oversight could have significant financial implications for a buyer. Take for instance a homebuyer that notices a seller disclosure revealing previous flooding in the basement and doesn’t inquire any further. Fast forward several years to when the homebuyer discovers a mold infestation in the basement. Because the seller disclosed previous flooding issues, there’s probably a strong argument against the homebuyer recouping the replacement and repair costs associated with fixing the basement.
An oversight or error in reviewing disclosures on a buyer’s part can certainly be costly, but buyers need to be just as wary of negligent or dishonest moves by a seller. If a prospective buyer has doubts or suspicions about a seller or a property, it’s imperative that they carefully review the provided disclosures and retain a copy for their records. Should they ever discover a property defect or issue, those disclosures will act as a saving grace in not only recuperating any and all replacement and repair costs, but also in holding a seller legally responsible for any fraudulent conduct.
Whether you’re a seller, homebuyer, or proud homeowner, meeting with an experienced real estate attorney to discuss questions and concerns on seller’s disclosures or suspected property defects can make all the difference.
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