Seller Disclosure And Home Inspections

On Behalf of | Jul 29, 2019 | Commercial Real Estate & Environmental Compliance |

Anyone who has either bought or sold a home knows that part of the process is preparing and reviewing a seller disclosure and having the property inspected by a home inspector.

A seller who starts to prepare a seller disclosure form is faced with the task of telling complete strangers about all of the faults of their beloved home. In a way, the seller is required to call their own baby “ugly”. This can be a painful process. Further, a seller may not realize the existence of certain problems with the house. Nevertheless, it is necessary to go through the process and, in fact, it is very important to disclose even the smallest problem with a home.

A buyer may walk into a house and fall in love with it immediately. At the same time, it is very important to remain open-eyed, review the seller disclosure form and, especially, get a home inspection done by a competent home inspector. A good home inspection will cover all of the critical systems within the house and give a buyer the opportunity to determine problems which may result in major problems downstream in the buyer’s ownership. It may also give a buyer good reason either to ask for a price reduction or walk away from the transaction.

In Pennsylvania, sellers have a number of real and potential liabilities, and buyers have substantial rights in connection with the disclosure process. The Pennsylvania Seller Disclosure Law is a statutory list of matters which must be disclosed by a seller during the course of the sale of a residence. The law also provides penalties for important disclosures which are not made or are actively concealed by a seller. What most sellers and buyers don’t realize is that a seller’s failure to disclose a problem may subject the seller to penalties under the Pennsylvania Unfair Trade Practices and Consumer Protection Law. Among other things, a buyer is treated as a consumer. Although the seller may be a consumer in other matters, once a seller enters into a contract to sell that property to a buyer, the seller is no longer a “consumer”. The potential penalties under both laws include the award of treble damages and attorney’s fees to the buyer.

The best course of action is for a seller to disclose everything, and for a buyer to review everything. As a practical matter, buyers should remember that if a buyer walks through a house and detects some condition that doesn’t seem right, the buyer should ask questions and not be satisfied with an oral response. Any response to a buyer’s question should be in writing. This benefits both the buyer and seller because the buyer knows what the response is and the seller because there can be no misinterpretation of what the seller has told the buyer.