Yahoo Finance

Before you buy a house, you want to learn all you can about it — its history, its condition, any nearby nuisances, and more. After all, buying a home is expensive. And knowing all this information? That can help you decide if a house is truly worth your investment.

One tool to help you do this is the seller’s disclosure, a document that sellers must provide before you buy a property.

Read more: How to buy a house in 13 steps

In this article:

• What is a seller’s disclosure?

• What’s included in a seller’s disclosure?

• How to use a seller’s disclosure when buying a house

• Filling out a seller’s disclosure form as a seller

• FAQs

What is a seller’s disclosure?

A seller’s disclosure — also called a seller’s property disclosure statement or seller’s disclosure form — is a legal document that sellers must fill out when listing a property. It is used to disclose information about the home’s condition, defects, and history, and it is required in all U.S. states in some form or fashion.

Seller’s disclosures for buyers

Seller’s disclosures are intended to help potential buyers make more informed decisions about the properties they consider purchasing. The form provides critical details about the property condition and other factors influencing whether a home is a worthwhile investment.

Learn more: What to expect at the final walkthrough when buying a house

Seller’s disclosures for sellers

For sellers, disclosures are typically a legally required part of the home selling process. The exact information sellers must provide varies by state, as does the exact form that must be used. Texas' form, for example, is called the “Seller’s Disclosure Notice.” It spans four pages, includes 11 questions about the property, and requires the signature of both the seller and the purchaser. Florida’s is called a “Seller’s Property Disclosure.” It requires much of the same info but has more detailed sections on the home’s plumbing, roof, environmental hazards, and HOA and zoning restrictions.

Dig deeper: Selling your house — How to prepare and make the sale

What’s included in a seller’s disclosure?

Exactly what needs to be included on a seller’s disclosure statement depends on your state, but the seller typically must provide details about anything that is not working or needs fixing, past renovation or repair projects, the various gas/water/utility supplies to the home, and other key details a buyer might need to know before purchasing the property.

All in all, a seller may need to include:

• A list of the home’s appliances and built-in features, such as washer/dryer hookups, smoke detectors, ceiling fans, or a patio

• Any repairs or renovations made to the property

• Damage or defects to the foundation, walls, roof, doors, floors, driveway, and other areas of the home

• Any pest infestations, drainage problems, or hazardous conditions the seller is aware of (like asbestos, radon gas, or lead paint, for example)

• The age and condition of the roof

• Flood risk and any previous flood exposure

• Any homeowners' association (HOA) fees levied on the home

• Lawsuits affecting the property

• Details regarding the home’s water, gas, and sewage services

• Deed restrictions or local ordinances that affect the property

• Any ongoing property disputes or nearby nuisances, such as proximity to an airport or farm, for instance

Depending on where you live, the property owners may also have to disclose if there was a death in the home. For example, in California, if a death occurred on the property within the last three years, you must disclose it to a buyer.

Read more: Should you buy a house with a homeowners' association?

How to use a seller’s disclosure when buying a house

If you’re buying a house, the seller’s disclosure statement is critical. You’ll want to review it carefully with your Realtor and review each item line by line. Don’t be afraid to ask questions about anything that raises concerns.

You should also confirm that any repairs or renovation projects were properly permitted and ask for contractor receipts, product warranties, and inspection reports for any work that was done.

Finally, be sure to get a full home inspection and ask your inspector to pay close attention to anything noted as repaired or renovated on the disclosure form. They’ll need to confirm that the updates were done properly, safely, and up to code.

Learn more: Your home inspection checklist

Filling out a seller’s disclosure form as a seller

You’ll get your seller’s disclosure from your agent and fill it out yourself, to the best of your knowledge. However, your agent typically won’t help you complete the form due to liability issues.

When completing the form, you must be as honest as possible. Note any known current issues with the property, no matter how small, and be thorough when detailing any repairs, additions, or renovations you’ve done since moving into the home. You should also have receipts, contracts, and any other paperwork for those repairs ready and on hand in case the buyer or their agent requests them.

Failing to disclose something on a seller’s disclosure form could make you liable if something goes awry later. For example, if you fail to disclose faulty wiring in one room, and a spark later starts a fire after the new buyer is in the home, they could sue you for damages. This is why it’s essential to be honest and thorough on these forms.

Dig deeper: Is now a good time to sell a house?

Seller’s disclosure FAQs

What does ‘seller’s disclosure’ mean?

A seller’s disclosure is a type of legal document that a home seller uses to provide key details about the condition of the property. Buyers use it to evaluate whether the house is a sound investment.

Is it bad if there is no seller’s disclosure?

All U.S. states legally require sellers to provide buyers with an official seller’s disclosure form. If you have not been given a seller’s disclosure form for a home you’re looking to buy, speak to your real estate agent. Reviewing this document before deciding to go through with the purchase is important.

Can you sue if something is left out of a seller’s disclosure?

If a seller intentionally omits a known issue on their seller’s disclosure form, you could have grounds to file a lawsuit against them later on if an issue arises from a preexisting condition. Speak to a lawyer in your state if you’re considering this.

This article was edited by Laura Grace Tarpley.