Over 60% of Texas home sellers admit to hiding known property issues. That means many buyers walk into deals without knowing the full picture. When problems surface later, it can lead to legal trouble and unexpected costs for both sides.
But you don’t have to take that risk. By understanding disclosure rules, you can avoid penalties and protect yourself. Houzeo makes it easy to handle real estate disclosures in Texas when listing on the MLS.
What Is a Seller’s Disclosure?
A seller disclosures in Texas legally require homeowners to disclose the property’s condition, history, and known issues. This document ensures buyers understand any factors affecting the home’s value or safety.
Moreover, seller disclosure ensures transparency in real estate transactions. It also helps to minimize legal risks and attract serious buyers. Overall, it makes the selling process smoother.
What Has to Be Disclosed When Selling a House?
Here are the things you have to disclose to sell your home fast:
| Section Number | Things to Be Disclosed | Description |
|---|---|---|
| 1. | Items Present on the Property | It include items such as centralized A/C, dishwasher, spa, smoke detector, etc. |
| 2. | Condition of the House | Texas law requires sellers to disclose property defects, hazards, and structural conditions to buyers. |
| 3. | Defects & Repairs Required | You must manually fill out the form and disclose any known property defects that requires repair. |
| 4. | Flood Risks & History | Sellers must report floodplain status and submit TXR 1414 for properties in designated high-risk flood areas. |
| 5. | Past Flood Insurance Claims | Homes in high-risk flood zones with mortgages must have flood insurance. FEMA recommends coverage for both property and contents. |
| 6. | Previously Received Assistance for Flood Damages | This is applicable for sellers who have previously received assistance from Federal Emergency Management Agency (FEMA) or the U.S. Small Business Development (SBA). |
| 7. | Additional Things | Seller's Disclosure Checklist: HOA, lawsuits, rainwater systems, propane gas, and other key property details. |
| 8. | Seller's Tax Exemptions | Disclose all property tax exemptions when selling—like agricultural, senior, disabled veteran, homestead, or energy efficiency credits. |
| 9. | Unused Proceeds History | Disclose any unspent insurance proceeds from past damage claims on the property. |
| 10. | Presence of Smoke Detectors | Disclose if smoke detectors are present, as Texas law (Chapter 766) requires working detectors in homes for sale. |
| 11. | Deaths on Property | Disclose all violent deaths or property-related fatalities, including past incidents and hazardous conditions, to potential buyers. |
What Do Sellers Not Have to Disclose?
You can omit the following information from the seller disclosure form in Texas:
- Death on the Property (After 3 Years) – If death occurred over three years before the offer, you’re not required to disclose it (unless directly asked).
- Paranormal Activity – Ghosts, hauntings, or “stigmatized” properties don’t need to be revealed.
- HIV/AIDS Status – The health conditions of past or current occupants are legally private.
- Neighborhood Crime Stats – While major hazards must be shared, general crime history doesn’t require disclosure.
- Prior Owner’s Issues – Divorces, bankruptcies, or other non-property-related events stay off the form.
- Minor Defects You’re Unaware of – Only known material issues must be disclosed (you’re not a home inspector).
Who Is Exempt From Sellers Disclosure in Texas?
Sellers disclosure exemptions Texas apply in specific situations like court-ordered sales, bankruptcy, and certain familial property transfers, thus relieving disclosure obligations.
- Multi-Unit Properties: This exemption applies when selling a property that comprises a duplex or triplex.
- Personal Residences: If you’re selling a single-family home, townhouse, or condo that has been your primary residence for at least two of the past five years.
- Builder Warranties: New homes built by licensed builders are exempt from the standard disclosure requirements.
- Foreclosures and REO: Foreclosure lenders use inspections, not the TREC form, for property disclosure. Their requirements differ from regular Texas sellers of real estate.
- Transfers During Divorce: Property transfers between spouses, do not require disclosure.
- Gifts: The obligation to disclose does not apply when gifting a property. However, it is advisable to disclose known defects to maintain open communication.
- Relocation Companies: Companies relocating employees are exempt. But if they are also the seller of the property, they are exempt.
- Estate and Trust Sales: Properties sold by executors, administrators, or trusts are exempt from disclosure.
- Government Transfers: Government programs like eminent domain or urban renewal cause exempted transfers.
- Limited Value Dwelling: The value of a dwelling property not exceeding 5% of the total value receives an exemption.
Texas Real Estate Disclosure Laws
Failure to disclose known defects can lead to civil fines. Negligent misrepresentation or fraud claims may also result in liability.
- Texas Property Code, §5.008: This section outlines the requirement for selling a house (sellers of residential property) to complete a Seller’s Disclosure Notice, disclosing known material defects.
- Common Law and Contract Law: False disclosure info may cause misrepresentation or fraud claims. These claims can arise under common law or contract law.
- Texas Deceptive Trade Practices-Consumer Protection Act (DTPA): Deceptive false information on disclosure may violate the DTPA. The DTPA could address this misrepresentation or fraud.
Seller Lied on Disclosure Texas
If the seller lied about repairs on the Texas realtor’s seller’s disclosure notice, severe consequences may follow. This designed legal document ensures buyers receive accurate information regarding the property’s true condition.
False disclosure on the form may trigger buyer legal action. Buyers could seek financial damages for hidden property defects.
Tips to Minimize Issues in Texas Seller’s Disclosure Form
Here are the tips to save you from any legal issues:
- Complete a Pre-Sale Inspection: Conduct a pre-sale home inspection before you sell your home. It will help you to identify and address issues. This also helps build trust with potential buyers.
- Review the Sales Contract Carefully: Check the provisions about Texas sellers disclosure in your contract. However, failure to disclose can lead to legal issues. It can also cause the sale to collapse.
- Document Everything: Keep records of any repairs, renovations, or maintenance done on the property. Moreover, this paperwork is proof that you’ve dealt with known issues.
- Disclose Everything: To avoid problems in your house disclosure statement, you should disclose everything. Also, a minor issue could turn out to be important.
- Consult with Professionals: If you’re unsure about what needs to be disclosed, seek help from real estate attorneys. They are familiar with local laws and practices and can help you handle any issue.
How Important Is the Seller’s Disclosure Statement in Texas?
The seller’s disclosure statement in Texas is essential for maintaining transparency in the transaction. It ensures the buyer is aware of any known defects or issues with the property.
Currently, Texas 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.
