The problems you must report are the ones that are obvious: leaky pipes, rotting wood, basement flooding—basically anything about your property that has bothered you and that you know will bother the new residents. However, you can’t be cavalier about the unknown issues. In some scenarios, turning a blind eye could get you in hot water. Depending on the state in which you’re selling your house, you could be held responsible for not discovering unknown potential problems. Educate yourself about the specific disclosures your state requires. To get an idea of what you might be up against, let’s look at the regulations in California, one of the most stringent disclosure reporting states in the nation.
COMMON DISCLOSURE REQUIREMENTS:
• Any significant defects regarding walls, ceilings, floors, roofs, windows, doors, foundation, fences, driveways, plumbing, and electrical systems. • Lack of compliance with child safety standards. • Additions or modifications to any rooms in the house. • Use of hazardous substances on property. • Zoning violations. • Regular neighborhood noise disturbances. • Any features on property shared with neighbors. • Damage to property from fire, earthquake, floods, or landslides. • Deaths on property (within three years). • The location of any publicly registered sex offenders, or at least ensuring the buyers have knowledge of the sex offender database. 108
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