There are so many details to pay attention to when you’re buying a home. That can be hard because you’re probably also doing a whole bunch of other things at the same time, and you might feel a little overwhelmed.
But paying close attention to seller’s disclosures about your property is one of the very most important things you can do to make sure you’re buying the home you think you are. Otherwise, you might be in for an unpleasant surprise after the home is already yours.
Why Seller’s Disclosures Matter
Seller’s disclosure forms have a few purposes. First, they protect you by helping you understand as much as possible about the condition of the home you’re buying. Second, they protect the seller’s from possible future legal action. Because of this, it’s in their best interest to be as open and honest as possible about the home.
This is why it’s so important to read seller’s disclosures carefully. If you’ve reviewed the documents and haven’t objected to anything in them (which you can do according to the terms of your purchase contract), you’ve accepted the home as it is. You won’t have any recourse with the seller later.
In Oregon, the law says that the seller needs to deliver property disclosures to any buyer who makes a written offer. If the seller doesn’t do so, the buyer can revoke the offer at any time before the home closes. So you can see how important it is for sellers to deliver a complete disclosure to the buyers in a timely way.
Do I Still Need an Inspection?
Just a quick but important note: seller’s disclosures never replace an inspection on the home. This independent, third-party inspection of the home is still an incredibly important step in buying a home. Nothing replaces an inspection for uncovering potential issues with the home, especially ones homeowners aren’t aware of.
You’ll get the seller’s disclosures after making an offer, and you’ll have five business days to review those disclosures. If there’s a problem in the disclosures, you can back out of the deal until those five days are up.
After you’ve reviewed the disclosures, you’ll go ahead and schedule your inspection for the home.
Disclosures Required by the Federal Government
The federal government requires sellers to disclose that any home that was built before 1978 may have lead-based paint throughout the home. They also have to disclose any information they have about lead in their home.
How Oregon Disclosures Work
Oregon has a useful disclosure form complete with checkboxes for different items so sellers can easily discuss any known issues with their homes. The form is easy to use and has clear instructions for providing all the information buyers might need.
When an asterisk appears next to an answer, the seller should attach more information to accompany the answer—this could be a handwritten response, an inspection report, or other information that further details the problem or any repairs that have been made related to the issue.
For missing or incomplete answers, buyers should have their agent follow up with the seller’s agent to get more information about the issue. This can be a good opportunity to learn more about potential problems, and you may regret it if you don’t follow up when it seems like information is missing from the disclosures you’re given.
How to Read the Information on the Form
There are a lot of important sections on the Seller’s Property Disclosure Statement documents, but here are some of the main sections you’ll want to pay especially close attention to.
Title
The first section of the form deals with any potential title issues. It covers whether or not the seller has the right to sell the property.
This is also where sellers list encroachments, boundary agreements, or boundary disputes on the property. It also covers any other issues that may affect your interest in the property, including pending or existing government assessments and zoning violations.
Water
This section details the main source of water on the property, any required permits for that water source, and anything that’s impeding access to the maintenance of the water source. There is also a spot to talk about any wells or springs on the property, as well as any recent tests performed on those water sources.
Last, there is a section that discusses irrigation on the property and any outdoor sprinkling systems.
Sewer/Sceptic Tank
This section discusses the current sewage system on the property, as well as any new systems that may be added to the property in the future. If the property is connected to an on-site sceptic system, there is a place for the seller to add info about the system and how it was installed, as well as its condition.
Insulation
This is where the seller can disclose insulation in the ceiling, exterior walls, or floors. They should also disclose any defective insulated doors or windows.
Home Structure
The first part of this section asks about any issues with the roof, including leakage and moisture damage.
This section also has questions about pests, dry rot, and moisture and mildew problems.
You’ll want to pay close attention to these two sections because of all the rain we get here in Oregon. You’re especially likely to encounter issues with water in the basement or crawl spaces of older homes. Our old homes are likely to have cracks in concrete walls that let moisture in, which can cause structural damage, rot, mold, and mildew. With all the rainfall we have here in Oregon, this isn’t something you want to mess around with.
Next, there are questions about any additions, conversions, or remodeling done on the home. If any work has been done, the form asks if a permit was required, if one was obtained, and then if a final inspection on the work was retained. It’s important to make sure that any work was done according to the law.
This section also includes questions about the materials used in construction of the structure that have been involved in a recall or litigation.
Dwelling Systems and Fixtures
This section is also really important because it includes all of the major systems of the house, including the electrical system, the plumbing system, the heating and cooling systems, and the water heater tank, as well as any other appliances that are included in the sale of the home.
General
The last section includes other general information about the home, including disclosures about any damage it’s sustained from natural disasters and whether or not the home is in a designated floodplain.
This is also where the seller should mention any tests or reports they have for the home on asbestos, formaldehyde, radon, gas, lead-based paint, mold, fuel, or contaminated soil or water.
They should also mention any knowledge they have of the home being an Illegal drug manufacturing or distribution site.
Last, this is where the seller mentions other issues that may affect the property or its value.
Need Some Help?
If you’re feeling a little overwhelmed by the prospect of reading and understanding seller’s disclosures, never fear! That’s why I’m here—to help you understand exactly what you’re buying and how it may affect you in the future in your new home.
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