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SELLER PROPERTY DISCLOSURES

\"SellerIn Arizona, some do not understand why we ask a seller to fill-out a seller property disclosure statement (SPDS). Some sellers see it as a waste of time or something that might put them at increased risk, when really it is just the opposite. Some investors only own houses a couple of months and do not complete the SPDS; this is a disadvantage to them and the buyer.

 

When a buyer begins their inspection of a home, they should be presented with these disclosures so they are aware of any known issue (often referred as ‘material facts’). Besides it being the law in Arizona, it benefits the seller and buyer in several ways. First, the buyer becomes aware of an item with possible issues on the first day rather than waiting for the inspector to schedule an appointment after maybe a week. The buyer can decide if they are unwilling to accept the issue or a repair and save the seller valuable time. This could then allow the seller to accept a back-up offer or put the home immediately back on the market. Second, some sellers feel that they are still liable by stating ‘no’ next to an item on the SPDS. Some sellers think they are creating future liability since it is in writing if the buyer wanted to complain. For example, if the stove didn’t work after the buyers moved-in. The buyer then decides to sue the seller because they feel the seller blatantly lied to them by stating ‘no’ to any stove issues. However, this is a misunderstanding of the SPDS and a buyer’s due diligence. The seller is not signing a definitive warranty or guarantee that there are no issues when they fill-out and sign the SPDS. The seller is stating they are unaware of any issues; a requirement in Arizona by all sellers. The seller could have been a bachelor and never turned on the stove during his entire ownership of the home.

 

In Arizona, it is the buyer’s responsibility to inspect everything that might be an issue to buying and owning the home then decide before their inspection period ends if there is anything they would like the seller to fix. The seller does not need to know everything wrong with the home before selling; they simply need to be honest about what they do know. The seller is then protected if later accused of knowing something specifically wrong with the house that might seem blatant (like a stove) because it is recorded in the SPDS they were unaware. The SPDS make it clear for both buyer and seller. It is a benefit that informs the buyer, protects the seller, and saves time for all parties involved. 



Posted on: Tuesday 5th of February 2013
Written by: Brandon Switzer

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