How Can I Protect Myself Selling
claims by buyers against sellers involve misrepresentations
or sloppy disclosures. Here are a few guidelines for protecting
yourself when you sell your home. First, pick the right agent.
Your listing agent will represent you in interactions with
other agents, prospective buyers, lenders, inspectors, and
various professionals associated with the real estate business.
Be sure to select a trustworthy agent with whom you are compatible,
one who will represent you honestly and fairly in your dealings
with others during the sale.
be fastidious about preparing your property for sale. This
will not only facilitate the sale and bring you a higher price,
it could prevent after closing disputes with the buyers.
list of all the elements of your home that need repair or
replacement. Your agent can help you with this. If youreuncertain
about the condition of a major system, like the roof or furnace,
you might want to hire a professional to inspect and issue
how much it will cost to repair or replace defective items.
If you cant afford to repair everything on the list,
ask your agent to help you prioritize. Disclose any defects
that youre aware of that you dont fix before selling.
TIP: Sellers often fear that if they disclose defects to buyers
it will impede the sale of the property. This rarely happens.
In fact, buyers appreciate knowing about property defects
before they buy. Problems can develop when buyers discover
defects after closing that they know the sellers were aware
of, but failed to disclose.
home seller answered no when he was asked if he had any drainage
or flooding problems. He had remodeled his home to create
a family room in the lower level that had previously been
a basement. During the first heavy rain after the buyers moved
in, the family room was flooded with water. The buyers sued
the sellers in court and won. Its natural to feel proud
of your home. But, avoid over-selling your home to prospective
buyers. Be particularly careful about rooms that were added
without required building permits. Lets say your home
has four bedrooms, plus a room that was added without permits
that could also be used as a bedroom. From a marketing and
legal standpoint, youd be better off marketing your
home as a four bedroom, not a five bedroom, home. Interested
buyers will discover when they look at your home that it has
an extra room that could be used for a bedroom. Theyll
be pleasantly surprised to find more than they anticipated.
If you market the home as having five bedrooms, buyers will
be disappointed to find that the fifth bedroom isnt
a legal bedroom. If this information isnt
discovered until after closing, you could have a legal problem.
claims involve misrepresentation of square footage. When a
property is passed from one owner to the next, the square
footage is often rounded up to a higher number. For instance,
a 2900 square foot home might be represented as approximately
3000 square feet. The next owner might say the house has about
3000 square feet, perhaps a little more. Never guess about
square footage. Square footage claims can involve substantial
Check with your agent or real estate attorney if you have
any questions about your disclosure obligations. Disclosure
laws vary from one state to the next. But, there is a movement
nationally to require sellers to disclose material facts that
might effect the buyers decision to buy or the price
they might pay.