Why You Need A Seller’s Disclosure When Selling Your Home

Sellers in Texas are required by the state property code Sec. 5.008 to provide a disclosure to a prospective buyer of any known material defects and the physical condition of the property. The disclosure is designed to protect a buyer from hidden or undisclosed defects that the seller knows about. It is a legal representation of fact by a seller and is subject to liability if the buyer relied on the information. The single most common source of lawsuits is the lack of a properly completed Seller’s Disclosure. Therefore, the disclosure should be taken very seriously and completely filled out properly.

TREC Promulgates a Seller’s Disclosure of Property Condition form for use in residential real estate transactions.

The disclosure is completed by the Seller, initialed and signed by both Seller and Buyer, and attached to the One to Four Family Residential Contract.

1. Be honest.
2. Fill out the entire form to the best of your knowledge.
3. Disclose any known defects / material facts (ex: roof leak, plumbing issues, foundation, non-working dishwasher, mold, unpaid HOA fees, lawsuits, etc).
4. If repairs have been made, you can add that to the disclosure.
5. If the home was built before 1978, an Addendum for Seller’s Disclosure of Information On Lead-Based Paint must be completed and provided to the buyer along with a Protect Your Family From Lead In Your Home pamphlet.
6. The Seller’s Disclosure should be delivered to the buyer

1. Buyers should get the disclosure from the seller either before making an offer on the home or right after.
2. If the seller does not give the Seller’s Disclosure as required, Property Code section 5.008(f) permits the buyer to “terminate the contract for any reason within seven days after receiving the notice.”
3. Look the disclosure over very carefully and be diligent.
4. If there is something on the disclosure that you don’t understand or is of concern, have your agent talk with the listing agent about it. In some cases, the issue has been taken care of or it also may be an opportunity to negotiate.
5. It’s still advisable to get a home inspection before purchasing the home.

A seller has a legal obligation to disclose all material facts that he or she knows about their property. If the listing broker/agent or seller receives a prior inspection report, there is an obligation to disclose any material defects on that property. If there is a prior inspection report that is not delivered to the listing broker/agent or seller, then obviously, they don’t have any information to disclose.

If a seller received an inspection report and repairs were made, disclose the all the repairs along with invoices and warranties if they are available. When in doubt, DISCLOSE, DISCLOSE, DISCLOSE.