A key document in real estate transactions is the property disclosure statement, sometimes called the Seller's Property Disclosure Statement. That's because the seller is obligated (certify in Arizona) to disclose all known problems and defects with the property while the buyer acknowledges they've received this information.
When these statements are required by law, people have to sign the documents to indicate they have read, and understood them … so if there's anything you don't understand, you should ask for clarification before signing. These are legal documents and may become even more important if there's a dispute after the transaction is completed, e.g. here's a lawsuit where a builder committed fraud (sadly) by failing to disclose a roofing problem in their Residential Property Disclosure Statement.
Here are the things covered by Arizona's property disclosure statement. If the seller omits known problems, and a buyer can prove they were aware of the issues, there can be legal consequences.
- Roofing (hmm, I added siding and exterior trim as they're not included in Arizona form).
- Interior wall/ceiling/door/window/floor.
- Cracks or settling in the foundation, exterior walls or slab.
- Chimney and fireplace.
- Damage to any structure on the property by flood, fire, wind, expansive soil(s), water, hail.
- Heating and cooling.
- Plumbing including hot water heater, landscape watering system and water treatment systems.
- Swimming pool/spa/hot tub/sauna/water feature
- Electrical systems plus security
- Safety items including smoke/carbon monoxide detectors and fire suppression (sprinklers).
- Built-in appliances.
- Miscellaneous – known problems with scorpions, rabid animals, bee swarms, rodents, reptiles or other pests … and they checked both scorpions and reptiles for my new house in Arizona.
- Driveways, walkBuying a House: A 9 Step Guideways and fencing (not included in Arizona form).
For more details about a seller's property disclosure statement, read Amazing Home Seller Property Disclosure Statement.
Other articles to help you buy you new home include:
- Buying a House: A 9 Step Guide
- How Difficult is Buying a House?
- Finding a Realtor When You're Ready to Buy a House
- Confusion Between Pre-Qualified & Pre-Approval
- Debt-to-Income Ratios
- Managing the Home Mortgage Process
- Statute of Limitations and Sellers' Full Disclosure