"As Is" Still Requires Disclosures

December 7, 2009

With so many properties being offered for sale that are "bank-owned", it is important to know what sorts of disclosures are still a requirement for the seller (bank) to furnish to a Buyer. Typically "bank-owned" properties are listed as being sold "as is". These sellers and their agents, and probably the buyers' agents as well, need to be reminded that "as is" does not eliminate a seller's responsibility to disclose material facts.

California disclosure law does exempt sellers of foreclosed properties from completing a Sellers Transfer Disclosure Statement (TDS). However, there are still other disclosures that are required on the sale of 1-4 residential units.

1. Agency Disclosure

2.Agents duty to visually inspect and disclose.

3. Lead Paint Hazard Disclosure plus the "Protect Your Family from Lead in Your Home" book.

4. Disclosure of condominium or common interest documents.

5. Disclosure of property's location in a flood zone.

6. Megan's Law disclosure.

7. Meth lab clean up

8. Seller's Affidavit of Non Foreign Status

9. Smoke Detectors installed and operating

10. Notice of availability of title insurance

11. Certification that the water heater is braced properly.

Many of these disclosures are covered in the standard California Association of Realtors Agreement to Purchase. Others are not and will require the listing and selling agents to follow through to make certain that the seller provides the disclosure and that the buyer receives it.