A Review of the Residential
Property Disclosure Statement
I
know we are all familar with the Residential Property Disclsoure
Statement; however, I thought it would be useful to go over some lesser
known rules regarding the form. First, there are a number of
exempt transfers such as the following: foreclosure sales, REO sales,
sales from fiduciaries such as executors and trustees, sales of newly
constructed dwellings, and sales when both parties waive the
requirement.
Second, regarding the statement, a
broker's duty is to inform a client of his or her rights and obligations
in providing the statement. A broker is not liable for a seller's
refusal to provide a statement if the broker notifies the seller of his
or her obligation to do so. A broker's independent duty to
disclose material facts regarding the property is not altered or
affected by a seller's compliance or non-compliance.
Third, a seller is not liable for money damages for failing to provide a
disclosure statement. A buyer's sole remedy is to cancel the
contract within three days of the earlier of receipt of the statement or
the contract date. Any information on a disclosure statement
would certainly be evidence in a lawsuit alleging seller fraud.
This newsletter concludes my series on issues of disclosure.
Beginning in September, I will address various challenging contracting
situations such as short sales, REO sales, sales from estates, and sales
of new construction.
Do
not hesitate to contact me to receive more information on this topic or
to suggest topics for future editions of 'A Legal Moment'. You may not
rely on this content as legal advice for any specific situation, but
should instead contact an attorney for specific advice. | 
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