Ensuring a Smooth Buying and Selling Process – No Lawsuits!

One of the most important things you can do when selling your home in Los Angeles to avoid legal action is disclose, disclose, disclose. The most lawsuits arising after close of escrow would seem to be directed at sellers and agents who do not disclose known issues affecting the condition of the property in question.

Selling your home in Los Angeles? Disclose everything you know

It is so tempting not to want to draw prospective buyers’ attention to problems you may have had in the recent past, but a seller is contractually obligated to disclose any facts of which they are aware. Let’s say you hear from a third party about a problem concerning your property of which you are not aware, err on the side of caution and disclose that fact. You can say you don’t know about it and heard it from a third party. It is then incumbent on the buyer to check this out for themselves.

The rule of thumb is If you are not sure about something, disclose it anyway. For instance, by law you don’t have to disclose a death on the property that occurred more than three years prior. Of course if asked you have to. But maybe someone died on the property three years and one month prior. Maybe you might want to clear the air on that one. Maybe there was a water leak that you fixed a couple of years ago. Disclose it. Presumably you have fixed it, but you don’t want a buyer finding remaining evidence, like a stain, and wondering what you are hiding.

You will actually have to fill out a form called Sellers Property Questionnaire (SPQ) as part of your contractual duty towards your buyer. This form asks multiple questions about your property that you will need to answer and provide explanations for several of them. Some of these questions may jog your memory. If you are selling someone else’s property as a trustee for instance, you are not obligated to complete this form as you may not have full knowledge of its condition. The buyer is going to have to be extra diligent in this case.

You may have already have had a buyer who did their inspection and, for whatever reason, didn’t complete the sale. They are obligated to provide you with a copy of that inspection and what is learned from that inspection needs to be disclosed to any future buyers.

Never state as a fact information of which you are not absolutely sure. You can offer this information and inform the buyer that they need to do their own due diligence. Square footage for an example often comes from Public Records and cannot be relied on for accuracy. Always suggest the buyer confirm this on their own if that is important to them. Which school district the property is in is also something the buyer needs to check out for themselves.

Above all, the buyer must do his or her own due diligence through the Buyer’s Inspection and subsequent inspections recommended by the Inspector. If there is any doubt inspect, inspect, inspect.

Unless the buyer waives his or her right to one they will conduct a general inspection of the property and possibly additional targeted inspections. If you have disclosed everything you know about the property anything the inspector(s) finds should be things you know nothing about and you will negotiate who, if anyone will remediate the problem(s). At this point anything that happens after the close of sale will be regular wear and tear and you will not be held liable.

Better safe than sorry. Disclose, Disclose, Disclose.

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