A disclosure is an acknowledgement of facts that one party feels that the other party would consider material to the transaction at hand. It is always best to make disclosures in writing, and not rely on the fact that something may have been disclosed orally.
Examples of a relevant disclosures in a real estate transaction would be:
- Water in basement
- Roof leaks
- A previous resident was murdered in the premises
- Known physical issues – foundation cracks behind walls
If you are a seller, whether you think it’s insignificant or not, disclose it. We refer to disclosures as your “Get Out of Jail Free” card because if you disclose it to the buyer prior to the closing of the transaction and they acknowledge it, they are accepting the property subject to that disclosure.
If you do NOT disclose it, that gives the buyer the potential to sue you later if you do not disclose it to them, in writing, prior to closing of the transaction.
It’s good to put in writing anything and everything that could be a potential defect to the property. If you don’t, you may be subject to a lawsuit later.