Did you know, over 60% of home sellers in the US admit to hiding known property issues? Many buyers think they’re getting a fair deal—until the problems surface. By then, it’s too late. Legal battles, unexpected costs—no one wins!
But you don’t need to worry. Seller Disclosure California is your safeguard against all of that. By being upfront, you protect yourself and your transaction. What’s more, Houzeo makes listing on the California MLS easy and guarantees transparency at every step.
What Is a Seller’s Disclosure in CA?
In CA, a seller’s disclosure is a legal document that details your home’s condition and history. You must disclose issues like water damage or foundation cracks to avoid legal consequences. This allows buyers to make an informed decision and avoid nasty surprises.
Further, if your property has experienced damage from natural calamities like earthquakes or wildfires, you need to disclose it. Skip that, and the legal fallout could slide downhill like a mudslide!
What to Disclose When Selling a House in the Golden State?
California law requires you to share everything about your property’s condition when selling a house in CA. However, if you sell your house for cash, you can skip this step. Here’s what you need to disclose before closing the deal:
- Real Estate Transfer Disclosure Statement (RETDS): This is your go-to form for letting buyers know about any major issues with the property. This can include issues ranging from plumbing problems to structural issues.
- Natural Hazard Disclosure: In California, you’ve got to disclose if your home sits in a wildfire, earthquake, or flood zone.
- Lead-Based Paint Disclosure: Got any vintage charm? You must disclose if there’s lead-based paint. Further, buyers retain the right to conduct a lead-based paint inspection.
- Megan’s Law Disclosures: You must let buyers know if the property is near a registered individual under Megan’s Law.
- Homeowners Association Disclosures (HOA): Got a homeowners association? Let buyers know the details about the fees and rules. Do not forget to inform the buyers about any pending legal actions involving the HOA California.
- Smoke Detector and Water Heater Compliance: You must certify that smoke detectors and water heaters comply with state law requirements. Ensure all installations are properly functioning and up to code.
The No-Gos: What You Don’t Have to Disclose
You can omit the following information from the California seller disclosure form:
- Death on the Property (After 3 Years): You don’t need to disclose a death if it occurred over three years ago, unless directly asked.
- Paranormal Activity: You don’t have to reveal any supernatural presence or haunting. The state doesn’t require disclosure of stigmatized properties.
- HIV/AIDS Status: The health status of former or current occupants is private, which you not necessary for the disclosure.
- Neighborhood Crime Stats: While major hazards must be shared, general crime history doesn’t require disclosure.
- Prior Owner’s Issues: A prior owner’s personal history, such as divorce, isn’t part of property disclosures.
What is an Exempt Seller Disclosure in California?
In California, there are specific scenarios where sellers don’t need to fill out the RETDS. These exemptions help clarify which sales or transfers are not subject to the California real estate seller disclosure requirements.
Here are some of the most common exempt seller disclosure situations under California law:
| Sr. No | Exemptions | Explanation |
|---|---|---|
| 1. | Sales Before Public Reports | Transfers that are made before furnishing public reports under Section 11018.1 of the Business and Professions Code, or made without Section 11010.4 of the Business and Professions Code. |
| 2. | Sales Due to Court Orders | Court-ordered sales, such as estate or foreclosure sales, follow specific procedures and are exempt from RETDS requirements. |
| 3. | Mortgage/Foreclosure Exemptions | Transfers to mortgage lenders or those occurring in foreclosure sales. This also includes acquisitions in lieu of foreclosure. |
| 4. | Exempt Fiduciary Transfers | Executors of wills or fiduciaries handling trusts, guardianships, or conservatorships. |
| 5. | Transfers Between Co-owner | Transfers made between co-owners do not require disclosures in real estate. This exemption applies to property held by more than one owner. |
| 6. | Transfers to Family | Any transfer made to a spouse or person/s in the lineal line of consanguinity. These transfers within the immediate family line are often treated differently. |
| 7. | Divorce/Separation Transfers | Transfers resulting from divorce decrees have specific legal considerations. Settlement agreements between spouses also lead to property transfers. |
| 8. | Unclaimed Property Transfers | Transfers administered by a Controller of Unclaimed Property. The Controller handles transfers of properties deemed unclaimed by owners. |
| 9. | Tax-Defaulted Property Transfers | Any transfers carried out by a collector of a tax-defaulted vacant residential property, or where the property is deeded for taxes to the state, county, or public agency under the California Revenue & Taxation Code. |
| 10. | Government Entity Purchases | Government entities purchasing property follow specific acquisition procedures. These public agency buyers often have distinct reporting requirements. |
| 11. | Non-Residential Portion Sale | Transferring only a section of the larger property has different rules. This applies when that portion is not a single-family home. |
| 12. | Limited Duration Sales | Sales for a limited duration are not subject to seller disclosures. This exemption is often seen in short-term ownership scenarios. |
What Is the Penalty for an Incorrect CA Seller’s Disclosure Form?
The California seller’s disclosure notice legally requires honest reporting of property defects. Intentionally lying could even lead to perjury charges.
Moreover, dishonesty ruins buyer trust, potentially derailing your sale and inviting penalties. The California Department of Real Estate (DRE) might fine you or suspend your license. So, it’s better to seek legal advice regarding the disclosures real estate entails.
How to Minimize Issues in the California Seller’s Disclosure Form?
To reduce issues with your seller disclosure in California, be thorough, accurate, and proactive. Here’s how:
- Complete a Pre-Sale Inspection: Get a thorough home inspection and fix what you can. This reduces the number of defects you have to disclose.
- Review the Disclosure Carefully: Check for unclear wording or missed disclosures. If you don’t comply, you risk legal trouble or losing the buyer.
- Consult with Professionals: If you’re unsure about the disclosure agreement, consult a real estate attorney in California. They understand local real estate disclosure laws and can help you with the seller disclosure requirements.
- Keep All Bills and Records: These act as supporting documents to your seller disclosure. They also prove that you have addressed any known issues.
- Be Aware of California-Specific Disclosures: Make sure you include mandatory disclosures like Natural Hazard Reports, Mello-Roos taxes, and lead paint in homes built before 1978.
How Important Is the Seller’s Disclosure Statement in California?
Incomplete property disclosures in the U.S. can lead to fraud liability. Buyers may sue for damages or to cancel the sale. Prioritizing thorough disclosures in real estate minimizes these legal risks.
Currently, California’s housing inventory gives buyers ample choice. Consequently, they are quick to move on to another property if they encounter unexpected defects. So, you must be transparent when completing the seller disclosure. You could face legal consequences if you don’t provide accurate information.
