Typically, a person selling their home must disclose material problems or defects in the property under California state law. If the seller hides issues, they could face a lawsuit for defects the buyer finds after moving in. However, the seller doesn’t have to inform the buyer of all issues.
For example, if there’s a small crack in the wall that shouldn’t cause severe complications, the seller doesn’t need to notify the buyer. The seller only has a legal obligation to inform of any defects that might cause injury or affect the buyer’s decision regarding whether they want to buy the home.
Property Defects Required on the Disclosure Form
California law requires a seller to disclose significant problems with the home, such as:
- Toxic substances, such as radon, lead, asbestos, or mold
- Roof or ceiling leaks
- Converting, improving, or adding to the home without using the necessary permits
- Presence of insects, termites, rodents, or other pests
- Whether the home is in a flood zone, fault zone, high-risk fire area, or another dangerous natural condition
- Faulty electrical wiring
- Mechanical issues, such as air conditioning, heating, or a defective appliance
Aside from disclosing defects, the seller can’t actively conceal or try to conceal any issues that exist on the property. For example, painting over defective wires to hide them from the buyer is prohibited.
If the home is new, an implied warranty of fitness should apply. An implied warranty of fitness means the condition of the property must be suitable for someone to reside.
Party Responsible for A Disclosure of Defects Transaction
It’s the seller’s responsibility to disclose serious defects with the property that could affect whether a buyer decides to proceed with purchasing the home.
However, if a real estate agent or broker represents the seller in the sale and knows of any problems, they should be the one to disclose them to the potential buyer.
Even if the seller asks their agent to hide issues contained in the property, the agent could still disclose the information. Real estate agents and brokers are held to a higher standard than the seller. The obligations real estate agents and brokers have for disclosing property defects are something they take seriously.
Penalty for Failure to Disclose Defects
If the seller negligently or willfully violates or fails to carry out their duties, they could be liable for the seller’s losses. In other words, the seller must compensate the buyer’s losses and remedy the situation if they don’t disclose the property defects.
The remedies available to the buyer include:
- Rescission or cancellation of the purchase of property
- Compensation for breach of contract
- A financial award for fraud
- Specific performance, requiring the seller to fix the problem instead of paying the buyer
- Punitive damages
Contact a California Real Estate Lawyer
The California real estate attorneys of Winton Strauss Law Group, P.C., have over 60 years of combined legal experience serving Northern California. We have represented clients like you and will work hard to protect your rights. We have the resources and skills to create the necessary legal strategy to meet your needs and pursue your desired outcome.
We understand the risk someone takes when they decide to sell their home. You must follow state laws and strict legal procedures to proceed with the sale. If you’re not careful, you could find yourself facing a lawsuit. A dedicated legal team by your side can provide the guidance you need and deserve.
If you’re thinking about selling your home or have already started the process, do not hesitate to contact Winton Strauss Law Group, P.C. We can assist you with the defects disclosure and additional requirements you must meet to avoid litigation in the future. Contact us today for your initial consultation.