✏️ Editor’s Note: Realtor Associations, agents, and MLS’ have started implementing changes related to the NAR’s $418 million settlement. While home-sellers will likely save thousands in commission, compliance and litigation risks have significantly increased for sellers throughout the nation. Learn how NAR’s settlement affects home sellers.
As a seller in Kentucky, you may have several questions and doubts in your journey on how to sell a house in Kentucky. Moreover, seller disclosure documents in Kentucky are one of the legal documents in your journey of selling. Questions such as how does for sale by owner work in Kentucky or whether opting for a real estate agent would be better creates distress and confusion among sellers.
Once these issues are tackled, you find yourself in a sea of legal paperwork. They are complex and may also seem daunting. Worry not, we are here to guide you through real estate disclosure laws in Kentucky.
If you are selling a property in Kentucky, here are all the seller disclosure requirements you need to know:
- Federal Disclosure of Information on Lead-Based Paint and/or Lead-Based Paint Hazards
- General Disclosure Requirements
» Also Read: Foreclosure in Kentucky– Read our blog to know how to stop foreclosures in Kentucky.
Residential Lead-Based Paint Hazard Reduction
The Residential Lead-Based Paint Hazard Reduction Act passed in 1992 requires the disclosure of any lead-based paint or chipped paint in any housing built before 1978
The Residential Lead-Based Paint Hazard Reduction Act aims to protect property occupants from lead paint that could lead to health condition problems. Mostly, children are at risk and can cause growth, headaches, and high blood pressure. The act applies to public and private housing, federally owned housing, and specifically houses built before January 1, 1978. Under federal law, the seller or landlord must require to (a) give you a pamphlet about “Protect Your Family From Lead in Your Home”, (b) notify information about lead-based hazards, (c) give lead-based paint reports, (d) provide an attachment that contains Lead Warning Statement and documents that confirms the seller complied with the statute requirements.
Although the seller can provide a 10-day period for the buyer to do a risk assessment or paint inspection for lead-based paint or lead-based paint hazards. For safety purposes, the home buyers may look for a lead hazard inspection firm by following this link.
Also Read: Companies that buy houses for cash in Kentucky – Find out the 9 Best Companies that Buy Houses for Cash in Kentucky.
General Disclosure Requirements
According to the Kentucky Real Estate Commission, the seller disclosure in Kentucky form is “based solely on the seller’s observation and knowledge of the property’s condition and the improvements thereon. This disclosure form shall not be a warranty by the seller or seller’s real estate agent and shall not be used as a substitute for inspection or warranty that the purchaser may wish to obtain.” In addition, the form contains a statement of the property’s condition and features that are best known by the seller. The said defects are only of which the seller knows. Otherwise speaking, the seller doesn’t need to perform a home inspection if the electrical system is working properly before delivering the form to the buyer. If you honestly don’t know about the defects, you need not worry—and it’s the buyer’s burden to investigate.
The Kentucky Revised Statutes § 324.360 states that sellers are obliged to make certain property disclosure to the buyer prior to the sale. It’s a four-page form that has series of questions that can be responded with “N/A”, “Yes”, “No”, and “Unknown”, and provide an explanation to add details about the defects. The form shall disclose the following “(a) Basement condition and whether it leaks; (b) Roof condition and whether it leaks; (c) Source and condition of water supply; (d) Source and condition of sewage service; (e) Working condition of component systems; and (f) other matters the commission deems appropriate.”
As a seller and as the only source of all the information in this form, here are more statutory disclosure requirements details you are obliged to state:
House Systems (Past or current issues).
Plumbing, Electrical system, Appliances, Floors and Walls, Air Conditioning, Water Heater, Heating System, Sprinkler system, Pool, tub, sauna, Chimneys, Fireplaces, Pump, Security system, Ceiling and attic fans, Doors, and Windows
Foundation/Structure/Basement.
Basement leak, slab or foundation issues, basement repairs, water or drainage problems
Roof.
Roof covering age, roof leak, roof repairs, roof replacement.
Land/Drainage.
Soil stability problems, drainage issues, flooding, or grading problem, retention/detention basin, pond, lake, creek, spring, or watershed adjoining the property.
Boundaries.
Staked or pinned survey of the property, boundaries marked, encroachments or unrecorded easements to the property.
Water.
Source of water supply, water purification system or softener.
Sewer System
- Is property serviced by categories:
- I. Public Municipal Treatment Facility
- II. Private Treatment Facility
- III. Subdivision Package Plant
- IV. Single Home Aerobic Treatment System
- V. Septic Tank w/ drain field, lagoon, wetland, others
- VI. Septic Tank with dispersal to an offsite, multi-property cluster
- VII. No Treatment/Unknown
Construction/Remodeling.
Structural modification, or alterations, permits and government approvals
Homeowner’s Association
Miscellaneous.
Formaldehyde, asbestos materials, lead-based paint, radon gas.
Underground storage tanks, old septic tanks, field lines, cisterns, or abandon wells
Environmental hazards (hazardous waste contamination or methamphetamine contamination)
However, the seller doesn’t have to disclose every issue about the property. For instance, it’s irrelevant and unnecessary to disclose the buyer that someone has suffered from AIDS or HIV at the house. Furthermore, facts about suicide, natural death, or paranormal activity are not necessarily included in the disclosure.
What if the seller fails to disclose any of this information to the buyer?
Misleading information and hiding defects are punishable by law. If the seller intentionally hid these issues—especially major ones—the buyer could sue the seller for fraud or breach of contract. Additionally, the act could cost you more on paying damages and time-consuming litigation. And worst, doing so to maximize profit can only cancel the purchase.
As best as possible, disclose honestly to your best knowledge. Sellers, however, are under no liability to verify the disclosed facts by performing an inspection. Accordingly, it is on the buyer’s decision to hire a home inspector and do some reports to confirm the defects stated in the form. So as a seller, answer the disclosure form thoroughly. However, litigation is a daunting and costly process and could waste a huge time for both parties. Hence, contact your real estate agent and attorney to understand more about the disclosure form and its process.
Tips To Minimize Issues in Disclosure Documents
| Review And Verify | There’s a time allowance (some permit 10 days) to review and verify everything about your Purchase and Sales Agreement—also the square footage, home usage, and marketing. |
| Ask Questions | Ask questions when in doubt. This would help you in avoiding future troubles. |
| Hire A Professional Inspector | A professional inspector can help you gather backup information about the property’s condition. You can also opt for a pre-inspection before listing. » More: Kentucky Home Inspections – Read everything you need to know about home inspection in Kentucky. Kentucky Home Inspector – Find out the best home inspectors in Kentucky. |
| Disclose Everything | To avoid problems in your home disclosure statement disclose everything you know honestly. Even though it’s a minor issue, you must disclose it. |
| Get A Licensed Agent Involved | The best way to avoid disclosure issues is to get a licensed real estate agent. Agents can help you manage and assist you in the process along the way. |
