If you have your home for sale or are planning to list it soon, keep in mind the importance of disclosing important facts about your property to any prospective buyers.
Many homeowners fear that sharing negative information about their property will scare away buyers. Usually, the opposite is true. If a buyer feels that you are not being forthcoming about the home and are perhaps dishonest by omission, they tend to walk away from the purchase due to distrust. On the other hand, if you lay all of your cards on the table from the beginning, buyers know what they are dealing with and can feel confident in their decision to move forward with the purchase.
Not only is it a good practice to be completely truthful, it's the law. If you sell your home with a problem that you didn't disclose, you aren't necessarily off the hook once the home has closed escrow. In fact lawsuits and claims against sellers are quite common once a buyer discovers something about the property that wasn't disclosed before the purchase. The last thing anyone wants is the headache of litigation, local and perhaps federal charges and maybe even having your home come back in which you need to attempt to sell it again.
The Arizona Association of REALTORS (AAR) has created a Residential Seller's Property Disclosure Statement (SPDS). This form is designed to assist sellers in disclosing material facts about the property. Sellers are instructed to answer the questions as truthfully as possible and to attach any supporting documentation. Your Realtor will supply you with a SPDS form when you initially list your property so that you can insure that you're practicing responsible behavior.
Information you need to disclose includes anything about the land and structure that might affect the salability, value or desirability of the property.
Common items to disclose are any past or current problems with the home such as roof leaks, plumbing issues, a cracked foundation, etc. You'll need to disclose if your property is in a flood zone, if there is known crime around your home, if your home is near a golf course, horse property or in the vicinity of an airport.
If there is a planned freeway near your home, if there are fissures on the land, if your home is governed by a homeowners association, or if you simply have disruptive neighbors, you must disclose anything you are aware of.
There are some items that sellers are not obligated to disclose such as if the property was the site of a death, occupied by a person with HIV/AIDS or located within the vicinity of a sex offender. If you have questions about what is and is not required by law to be disclosed, your Realtor can advise you.
If you've made any insurance claims on the property, you'll want to supply the prospective buyers with a loss report from your homeowner's insurance company. Known as a CLUE report (Claims Loss Underwriting Exchange), it is another important document for sharing pertinent information about your property.
So, as Nat King Cole one sang, " . . . straighten up and fly right," you'll want to be sure that in selling your home, you do just that! Disclose, disclose, disclose!