Did you know, over 60% of U.S. home sellers 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 is your safeguard against all of that. By being upfront, you protect yourself and your transaction. What’s more, Houzeo makes listing on the MLS easy and guarantees transparency at every step.
What Is a Seller’s Disclosure?
A seller’s disclosure form is a checklist of material defects, features, and property conditions. It informs buyers about issues that may reduce home value or affect purchase choices.
Sellers must truthfully disclose major defects (e.g., pests, legal issues) to avoid future legal disputes. State laws vary; work with a real estate agent or lawyer to ensure compliance. Agents often complete disclosures alongside MLS listings to finalize the sale process.
Importance of Seller’s Disclosure
Seller disclosures warn buyers about property issues, protecting sellers legally. By revealing problems upfront, they reduce the risk of lawsuits after closing.
| # | Importance | Description |
|---|---|---|
| 📋 | Full Property Disclosure Requirements | Property disclosures reveal defects, ensuring transparency for buyers and legal protection for sellers. |
| 🛡️ | Shield Yourself from Lawsuits | Disclosing all known defects, including inspection findings, helps avoid future legal liability issues. |
| 🤝 | Develops Credibility | Honesty and transparency are crucial when selling your house disclosures build trust and credibility. |
When to Provide Seller’s Disclosure?
A seller’s property disclosure form documents all known defects of the home for transparent buyer review. Smart sellers provide these disclosures early, typically before accepting offers or during negotiations.
| Before Receiving an Offer | When sellers disclose defects upfront, buyers gain clear insight into the property’s condition. This transparency attracts serious buyers and reduces negotiation risks later. |
| After Receiving an Offer | Sellers must submit disclosures by state deadlines post-offer, often during buyer inspections. Buyers then decide to proceed or withdraw. |
What to Include in the Seller’s Disclosure?
Disclosure rules differ by state; for example, Arizona requires military airport proximity notices, while California mandates Mello Roos details. To avoid issues, always know house disclosure requirements in your state.
The state disclosure forms differ in formality, but they contain some generic points, such as:
- Details about the nature of the occupancy of the property.
- Questions related to property defects that you can answer with “Yes”, “No”, or “Don’t know”.
- A list of issues that sellers need to check off (if present). The list of these defects differs depending on the state.
- Space to provide additional information about the property.
Disclosure forms are often multi-page, which can make them hard to locate and grasp. For this reason, working with a licensed agent or Realtor from a real estate company is highly recommended.
Common Real Estate Disclosures
Common real estate disclosures include property defects, legal issues, and environmental hazards affecting the property. By law, sellers must disclose these risks to ensure transparency and protect both parties.
For buyers, carefully review these disclosures to spot red flags. For sellers, especially if you are selling your home quickly, double-check the form for accuracy. This not only builds trust but also speeds up the sale process by reducing surprises later.
| Things To Be Disclosed | Description |
|---|---|
| Title Violations | First, sellers must provide full property rights and title documents to prevent legal conflicts. Secondly, disclose any existing legal claims that could disrupt the sale. |
| Hazards | Sellers must disclose property risks like lead paint, flood risk disclosure, or radon hazards. This ensures buyers make informed decisions and prepare for potential issues. |
| Structural Defects | Buyers must know the property’s structural condition, including roof leaks, basement floods, dry rot, or attic issues. Sellers should also disclose material defects (e.g., chimneys, pools) and pest problems. |
| Water Systems | Sellers must disclose the property’s water source, irrigation systems, water pressure issues, and pipe condition. Additionally, they should note any wells (active, sealed, or unused) and the septic tank’s status. |
| Electrical & Plumbing | Sellers must disclose electrical issues and confirm breaker functionality. Buyers should request permits/certifications for system safety. Also include appliance, internet, sauna, and pump details. |
| Water Heater System and HVAC | Check the age of water and gas heaters, and ensure heating/HVAC systems are maintained or replaced. Note their operational history to assess remaining lifespan. |
Do You Have to Disclose a Death in a House?
Buyers often worry about a home’s history, particularly past deaths. Fortunately, in states like California, sellers must disclose this information up front.
Lesser-Known Property Disclosures
Some state-specific seller disclosures are usually not known to home sellers. A few of them are as follows:
- Paranormal Activities: Some states require sellers to disclose known paranormal activity in a home. However, since only a few states enforce this, it’s a lesser-known rule buyers and sellers should check.
Currently, three states—New York, New Jersey, and Minnesota—explicitly include paranormal activity in their disclosure laws. - Nearby Sex Offenders: To ensure buyer safety, sellers should disclose nearby sex offender details. For example, California requires signing the Megan’s Law Database Disclosure Form during transactions. However, this form places responsibility on buyers to search the offender database if they choose.
- Military Airport Disclosure: Arizona and Virginia require military airport disclosures to inform buyers of potential risks. Alerts buyers to noise zones or accident risks.
What Is Caveat Emptor in Real Estate?
Under the “Caveat Emptor Rule” (meaning “buyer beware”), buyers in some states must inspect properties for defects themselves. If they skip inspections, sellers aren’t liable for undisclosed issues.
However, sellers still can’t hide certain risks. For example, homicides or suicides are typically left off disclosure forms, as they’re seen as irrelevant.
Types of Disclosure States
States fall into two groups based on how they handle home sale prices: Full Disclosure States publicly share this data, while Non-Disclosure States keep it private.
| What Is a Full Disclosure State? | In some states, like Maryland, you can find the sale price of a property on various real estate websites. This provides greater transparency and efficiency in the real estate markets. |
| What Is a Non-Disclosure State? | However, in non-disclosure states, home sale prices aren’t publicly shared like in full-disclosure states. Currently, 12 US states follow this rule, including Alaska, Idaho, Kansas, Louisiana, Mississippi, Missouri (some counties), Montana, New Mexico, North Dakota, Texas, Utah, and Wyoming.” |
What Seller’s Disclosures Are Applicable to Me?
Property disclosures in the US can be segregated into two types based on who governs the laws related to them.
Federally Required Seller’s Disclosures
These disclosures are governed by federal law; therefore, all U.S. sellers must provide them during home sales.
Lead-Based Paint Disclosure
Federal law requires sellers to disclose lead paint in pre-1978 homes. They must provide an EPA pamphlet and exposure history. Buyers must sign forms confirming receipt of this critical information.
Sellers must allow a 10-day window for buyers to test lead hazards. Failure to comply risks legal action and fines exceeding $10,000.
State-Required Seller Disclosures
Each state has different seller disclosure rules. To find your state’s requirements, click below for details.
| Region | States |
| Northeast | Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont |
| Midwest | Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, Wisconsin |
| South | Alabama, Arkansas, Delaware, Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, Washington DC, West Virginia |
| West | Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, Wyoming |
Locally Required Seller’s Disclosure
Beyond federal and state rules, sellers often must share local disclosures too. For example, some cities or counties require extra forms about property risks.
| Prisons and Jails | This realty disclosure for laws in San Diego County, California, informs buyers about the presence of jails, prisons, detention centers, and work camps. |
| Protected Trees | In Los Angeles, sellers must disclose if a protected tree is present on their property. Native trees with specific dimensions are considered “Protected Trees” in the city. |
| Septic Tanks | In the county of Allen, sellers are required to disclose the presence of a septic system along with its condition. They have to disclose it by filling out the county’s Seller Disclosure Form For Properties Served By On-site Sewage Systems. |
What Happens if a Seller Lies on a Disclosure?
Sometimes buyers discover sellers lied on disclosure forms. When this happens, buyers can take legal action against the seller.
- Property Disclosure Contract: If a seller lies on disclosures, the buyer can sue for fraud. As a result, the seller may have to pay for repairs and legal fees.
- A Case of Fraud: Buyers can sue sellers for fraud. If successful, they may claim punitive damages—often double or triple regular compensation.
Note: The buyer must first prove the seller intended to commit fraud. - Recission of the Contract: If the seller’s lie costs the buyer a lot of money, the court can cancel the sale. This is called “rescission.” The sale is undone, and the buyer gets all their money back. The court tries to put both sides back where they were before the sale happened.
What if the Seller Errs on the Disclosure Form?
If the seller makes a mistake on the disclosure form, they could face legal problems.
- Compensation of Damages: If the seller misleads the buyer, the buyer can sue. As a result, the buyer may receive compensation for damages.
- Suit for Negligence: Buyers can sue sellers for negligence claims. They may seek damages for seller mistakes.
Common FSBO Seller Mistakes in Disclosures
First, a seller’s disclosure helps buyers understand the home’s condition. Buyers care about safety and costs—this form covers both. Honesty builds trust and speeds up sales.
However, skipping disclosures is risky—in fact, it often discourages buyers. Even if not legally required, sellers should complete them early. For example, marking “unknown” is okay, but lying can lead to costly lawsuits. Finally, FSBO sellers must handle disclosures before closing, especially without an agent’s help.
Pro-Tips to Minimize Issues in Seller’s Disclosure Statement
- Review and Verify: Most states give you up to 10 days to review documents. Use this time to check the purchase agreement, FSBO Contract, and square footage.
- Ask Questions: Always ask questions to clarify doubts—it prevents costly mistakes later.
- Hire a Professional Inspector: First, hire a home inspector to check your property before listing. Their report will then highlight hidden issues so you can fix them early and avoid surprises later
- Disclose Everything: Provide complete and accurate information in your home disclosure statement. Include all known details about the property, even for smaller items.
- Get a Licensed Agent Involved: Working with an experienced real estate agent helps prevent disclosure problems. Low-commission Realtors can guide you through every step of the process.
How to Find a Realtor? Check our guide to finding the right Realtor for your transaction.
How Important Is the Seller’s Disclosure Statement?
The seller’s disclosure statement is a critical part of a transparent real estate transaction. It helps buyers make informed decisions by revealing any known property defects or issues.
In competitive markets, buyers quickly reject properties with hidden issues. Accurate disclosures protect sellers from legal problems and failed deals.
