Home Inspections, Defects and Disclosure
No home is perfect. So how much should you tell prospective buyers about defects-hidden or otherwise?
Real estate agents will tell you full disclosure is best. To protect everyone's interests, many real estate boards ask sellers to sign a detailed Disclosure Statement that itemizes improvements and identifies structural problems.
Of course, you want to put your home in the best light. But if you knowingly hide or fail to disclose a defect that the home inspection later reveals, you could sour the deal for a buyer who might have otherwise paid it little or no mind.
By failing to disclose defects, you put your good reputation at risk. Worse, you could face legal actions if your buyer discovers after closing that you knew about a particular defect.
Make defects work for you.
Turn lemons into lemonade. Describe any major structural defects in the listing agreement, but add that you have reduced the price accordingly! This tactic can especially help if you're in a hurry to sell.
Stand up to inspection.
A buyer will usually have your home professionally inspected before finalizing the sale. (As a rule, you will not be present at the inspection unless you are acting as your own agent.) The inspector identifies any problems-structural, electrical or otherwise-that might affect the value of the home today or in the future. After reviewing a written report of the home defects inspection, the buyer has three options:
- Accepting the problems as is
- Renegotiating after home inspection, asking the vendor to either reduce the price or pay to have the problems remedied
- Revoking the offer altogether
The next step toward closing is obtaining a current certificate of location or survey for your property.
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