To Sign or Not to Sign?
Updated: Nov 1, 2020
Understanding the Seller's Property Condition Disclosure Statement
In my experience, a disproportionate share of claims against Agents arises from the misunderstanding on the benefits of the SELLER'S PROPERTY CONDITION DISCLOSURE STATEMENT.
Agents typically are brought into a post-closing lawsuit because of a hidden defect that the Seller failed to disclose. And, typically, the attorney filing the claim adds a count against the perceived “Deep Pocket” Agent asserting a violation of New Jersey’s Consumer Fraud Statute.
The NJ Consumer Fraud Statute can expose the Agent to treble damages and attorney’s fees.
Our State Legislature, however, created a “Safe Harbor” provision for Real Estate Agents provided that the Disclosure Statement is properly completed.
Your signature, as a listing agent, on a Seller’s Disclosure makes just two representations:
1. The information found in the Seller’s Disclosure “was provided by the Seller” -i.e., you are not making any representation in a Seller’s disclosure.
2. After receiving the Seller’s Disclosure, and prior to providing it to the Buyer, you made a visual inspection “to ascertain the accuracy of the information disclosed by the seller”.
**Always insist on an executed Disclosure Statement, always conduct a post signatory inspection And always sign the statement.
Questions? Concerns? Comment Below.