This form is based on the condition of the property before a sale is made. The required document is needed to satisfy legal sales laws and to determine the condition of the property prior to sale. Not all properties are required to have this form though before or during a sale. Some exemptions to this rule are multifamily properties, new build properties and some government entities.
Who is Responsible for Providing the Disclosure Form?
The responsibility for providing the form relies on the seller. The seller must complete the form to the best of their knowledge of the current condition of the property. Sellers must account for all damage and conditions concerning the property asked on the form.
The seller does not perform an actual inspection and is not required to do so in most states. The seller must also complete the form and submit it to the agent within a desired time frame. If the seller does not submit a form, the buyer may actually receive a credit against sale price of the property of interest upon purchase.
Once the form is provided by the seller, the buyers will have the opportunity to review the form before signing. This form is required during the sale process and if it is not supplied, the buyer will sign another form stating that the property condition disclosure form was absent.
The agents of both parties are also responsible for contacting and informing the buyer and seller of their obligations concerning the form within the desired time frame.
Does This Replace a Professional Home Inspection?
Absolutely not. It is very important to have a home inspection and any other tests done prior to purchase of any home. This is the responsibility of the buyer and not the seller. The seller is only required to state their existing knowledge of the property in question.
Several issues could be apparent that the seller may not be aware that exist. A professional home inspector is trained to identify various issues that can alter the known condition of the property. In addition, tests for plumbing and electric should be done by a licensed professional to insure there are not issues or that concerns are stated prior to purchase.
What Conditions Does the Form Cover?
The property condition disclosure form will cover several areas of the property and can help identify areas of concern and affect insurance coverage. An example would be, if the seller is knowledgeable about the location of the property being in a flood plain.
If this is apparent to the seller and so noted on the form then the buyer will be made aware that, this is an area that will need inspection and to be addressed when inquiring about homeowner’s insurance. Something of this relevance once overlooked could be very costly to the buyer later.
A property condition form is a primer for the buyers to be able to acknowledge the condition of a property before purchase. It does not in any way provide a warranty or guarantee of said property and is for the basics of identifying necessary areas of concern.