November 26, 2018
The Property Disclosure Statement: What to Look Out For
Whether in Rhode Island, Massachusetts, or Florida, when someone is looking to buy a home they go through a number of standard steps. Among those steps, usually after a purchase offer has been accepted, comes the Disclosure Statement.
A residential Disclosure Statement is generally a checklist that the State in which property is being purchased requires the seller of the property to fill out in good faith, revealing any problems that may exist in the property as-is. This form is then required to be provided to the buyer—and in Rhode Island, to any realtor with whom the buyer has had contact.
What is Found on a Disclosure Statement?
Every disclosure statement should include anything that might be problematic or make a reasonable person reconsider the offering price or going through with the purchase altogether.
The Rhode Island Real Estate Disclosure Form, for example, contains sections for disclosures about:
- Any structures (such as a home) standing on the property, including the age of the building, the method of heating/ac, the hot water system, electrical service, etc.
- The types of utilities—sewage, water, etc.
- Municipal information, like previous year tax history, information about the deed and zoning, permits, wetlands and floodplain, etc.
- Information particular to condos and multi units.
- Notices about extant pools, any record of lead paint inspection and remediation, smoke and carbon monoxide detectors, whether the home has been tested for radon.
- Other issues with the structure, such as whether any fixtures, appliances, equipment or systems conveyed with the home need replacement or repair.
- Certain conditions the property may contain that are perhaps unusual, like the presence of asbestos, a cemetery or burial ground on the property, a landfill on the property, any presence of mold or previous flood damage, etc.
For the most part, the disclosure statements in Massachusetts and Florida are similar to this, but of course every State’s disclosure forms have their own quirks.
A buyer should examine this Disclosure Statement carefully, to make sure they find nothing in it objectionable. Further, an inspection will occur around the same time. Buyers and their realtor can use this Property Disclosure Statement to direct the inspector to any potential areas of concern.
Once the parties to a transaction have made it through the disclosure and inspection process, they have moved another large step closer toward closing. We at Topouzis & Associates, P.C. come in at this stage, performing title searches to confirm (or refute) the claims of deed and title revealed on the Disclosure form, and fix any defects if possible. We do things by the book, but think outside the box to ensure every element of the title conveyed is free and clear of any unanticipated problems.