Despite being a little bit scary and exhausting, buying a house is pretty exciting. Amidst that state of excitement, many buyers are likely to overlook some key red flags, including those which are singled-out for them in the seller disclosure reports. Even though sellers are required by the law to disclose everything they know about a home that they are selling, you as a buyer is obligated to come to terms with what is revealed in those disclosure reports. Below are the eight red flags on a seller disclosure report that you must never ignore when purchasing a home.
Mention of Asbestos or Lead Paint In the Seller Disclosure Report
When a seller disclosure report includes information which states that the home has or had lead paint or asbestos, you shouldn’t automatically just walk away from the property. Nonetheless, you should be cautious and do some research before resorting to removing or remodeling these types of homes. Ask a qualified professional to evaluate and test the property. With enough information on the health regulations as well as the costs, you can factor the remediation or removal costs into your offers.
Mention of Any Issue That Is Structural In Nature
According to Liane Jamason, a real estate agent from St. Petersburg, Florida, if a house has structure-related issues or other issues which can’t be fixed, the best thing for the buyer to do is just to walk away. If the house has sagging roof lines, exterior cracks in the walls, or major cracks in the foundation and they are mentioned in the seller disclosure report, consult with your real estate agent and reevaluate your options.
Notes about the Roof
Digging deep into what a seller means by statements such as “a few missing roof tiles” is not mandatory for you as a buyer; nonetheless, you shouldn’t take such statements lightly either. When a home inspector takes a look at a roof and recommends you to seek help from a licensed roofer; bring in a licensed roofer to examine the extent of the damage on the roof before deciding to close the deal on the property.
Statement about Earlier Flood Damage
In areas such as South Florida which are prone to hurricanes, there are more occurrences of flood damage than there are in other parts of the country. Floods can seriously wreck the foundation of a home and cause several problems including mold issues. If flood damage is mentioned in the seller disclosure statement, you are advised to be very cautious.
Unable To Acquire Proper Permits for Improvements or Additions
Take this warning severely because failure to acquire permits is a big red flag. As a buyer, you should expect what you inspect. The permits are the only things that can assure you that the work was performed by a qualified and experienced craftsman. If you ever find yourself facing such a scenario, you are advised to bring in a licensed home inspector to review the completed work. You should thoroughly review the seller disclosure statement so as to get a clear understanding of the scope of the completed work. Additionally, you should request and review copies of the invoices of the completed work. If the invoices aren’t from licensed contractors, you should walk away from that property may be unsafe.
An Item That Is Marked As “Unknown” Or “No Representation”
In states such as North Carolina, a seller can choose to mark an area of a home as “no representation” in the seller disclosure report with intentions of avoiding to disclose the characteristics or conditions of that area, even if he/she knows of the issues. This is a sneaky move that a seller can use to protect him/herself from a probable lawsuit from the buyer in the future. In many cases, when a disclosure is marked “no representation” without any reason, buyers usually find irregularities which cause them to walk away from that property in question.
Mention of Lien(s) On the Property
Be extra cautious when issues regarding liens pop up in a seller disclosure report. Certain types of liens can entirely stop the sale. Make sure you consult your real estate lawyer, Title Company as well as the other side’s representative so as to clearly understand all the issues and time frames it might take to clear the title. While liens are not impossible to remove, they normally take twice the expected time, and so buyers should be prepared for delays.
Land-Use Restrictions or Easements
A property’s value can greatly be affected by easements & land-use restrictions. Make sure to ask for a report detailing the easement. Some easements on the property may forbid the addition of permanent structures in certain areas of the property. For example, you may be planning to make big renovations or build an additional structure on the property after the sale is closed but then discover that the current easements prohibit you from building a permanent structure in the exact spot you hoped to establish your master suit. Furthermore, it would be a great idea to survey the property so as to identify any landmarks on it. Know if that landmark is no harm as well as how it affects both the property and its future value or marketability.
There isn’t anything that feels better than the feeling of knowing that you can now settle in your brand new home. However, don’t rush anything as it is always better to be safe than sorry. Pay close attention to those red flags noted above to avoid any probable future problems.