Better To Disclose

With the California real estate market on the road to recovery, escrows are once again opening and closing real estate transactions throughout the Coachella Valley and entire Southern California region. With more transactions, come a heightened need for real estate agents and sellers alike to familiarize themselves with California disclosure laws.

Most transactions involve less than four residential units and utilize a standard Real Estate Transfer Disclosure Statement (see Civil Code section 1102.6). This form is designed to help Sellers of California real estate properly disclose all material facts that could negatively impact the property’s value. The Seller is required to disclose facts both known and unknown by the Buyer about the parcel. The intentional or negligent completion of the Real Estate Transfer Disclosure Statement will subject a Seller to liability for non-disclosure and the Seller’s failure (or perceived failure) to meet disclosure requirements is a common source of real estate litigation.

Common real estate disclosures center around the physical structure being sold. Sellers regularly anticipate disclosures associated with the walls, roofing, plumbing, foundation, etc. However, the legal disclosure requirements also extend to lawsuits filed by or against the Seller or in any way threatening or affecting the property. This requirement includes claims alleging a defect or deficiency. In other words, California courts have suggested that a Seller must disclose prior lawsuits if the knowledge of the lawsuit would impact the Buyer’s decision to purchase the real estate. If successful, a Buyer’s non-disclosure suit will result in an award of actual damages.

Similar to the saying, it is better to give than to receive; Sellers must remember, it is better to disclose than to deceive.

Amir H. Afsar, Esq. is an attorney and the founder of Afsar Law Group, A.P.C. which represents clients in business, real estate, construction, and estate planning matters throughout the Coachella Valley including Palm Desert, Palm Springs, Rancho Mirage, La Quinta, Indian Wells, Indio, Bermuda Dunes, Cathedral City, Banning, Joshua Tree, and other cities located within Riverside and San Bernardino County. Mr. Afsar can be reached at Afsar Law Group, A.P.C. at 760.345.3110.

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