Business Department

Before you decide to sell your house yourself, learn your rights, responsibilities and obligations. Otherwise, that sale may cost you dearly

Many individuals who are selling their homes themselves are not aware of the legal requirements to inform potential buyers of possibly defective conditions of the house, nor the dire consequences for their failure to comply with the Pennsylvania Real Estate Seller Disclosure Law.

Pennsylvania Real Estate Seller Disclosure Law
The Law has been in effect since late 2001 and requires a seller of real property to disclose any "material defects known to the seller" by providing a seller disclosure form. The form is usually provided by the real estate agent who lists the property or the seller's lawyer and, after the seller completes it, is given to potential buyers.

The law specifies that a seller must disclose all known defects in the property and sets forth sixteen subjects which must be disclosed. These subjects cover everything from the seller's expertise in contracting and construction to the condition of the electrical, plumbing and heating systems. The seller disclosure form is designed to assist the seller in complying with his or her obligations under the law. However, if there are additional known material defects that are not specifically asked about on the form, a seller is still required to disclose them. A great many lawsuits arise from the non-disclosure of a history of wet or flooding basements, or the non-disclosure of a roof that started leaking a week before selling the house.

Consequences for Failure to Disclose
With so many sellers choosing to avoid a real estate commission by selling their property themselves in this hot real estate market, sellers are not made aware of the law and fail to deliver the required disclosure. Their failure to provide the disclosure exposes the seller to liability for damages suffered by the buyer, or even rescission of the sale requiring the seller to buy back the house, sometimes years later.

While a seller must disclose known defects, there is no affirmative duty to make a specific investigation just to fill out the disclosure statement. Further, a seller is not liable if he or she had no knowledge of the defect not disclosed on the statement, or the error on the statement was based on a reasonable belief that the defect had been corrected. Also, if the seller relied on a professional's opinion regarding what was later learned to be inaccurate, there is no liability. However, all of these protections assume a disclosure statement was provided, and was merely inaccurate.

Timing is Critical
The timing of when the form is presented to a potential buyer is important because the law requires it be given to the buyer before an agreement of sale is signed. In addition, once the form has been given to the buyer, a seller should ask the buyer to sign and return a copy of the form to acknowledge the buyer's receipt and seller's compliance with the law. If, prior to selling the house, any information supplied on the form changes or is no longer accurate, the seller is required to supplement the disclosure form in writing with additional information.

Conclusion
In the transfer of real estate in Pennsylvania, the seller must be aware of his obligation to provide a disclosure form, especially in today's frequent "For Sale By Owner" (FSBO) sales. Just because you are not using a real estate agent or lawyer does not relieve you of the obligation to disclose known material defects.

MacElree Harvey
17 West Miner Street
Post Office Box 660
West Chester, PA 19381–0660
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