Are you at risk?
As a home seller, are you at risk of being sued?
Here is how bad advice and bad decision making on your part can cause you financial ruin…
‘Hiding’ from the truth can often help you sell your home more quickly and for a higher price. With this, TROUBLE lurks down the road.
If your house has cracks and obvious repairs to the exterior and interior surfaces, and you decide to sell your home, and if you conceal these signs of structural movement, you may be setting yourself up for disastrous consequences. Homebuyers don’t like surprises. The same forces that caused the cracks and other damage to your house in the first place, are most likely still impacting your home. The damages will most likely re-appear. This sets the stage for lawsuits.
If your house has mold growth, simply removing the mold or painting over the mold will, in all likelihood, result in the mold returning once the new owners have moved in. If you haven’t identified the cause of the mold (food source, temperature, and moisture) and taken appropriate measures to remove the cause and not just treating the symptom, this sets the stage for lawsuits.
If you bought your house in the last few years, and had an inspection performed on your house, or you have had major issues with the home such as a faulty foundation, a house-fire, mold, or flooding, you should disclose this to any prospective buyer of your home. Trying to conceal or hide these facts sets the stage for lawsuits.
If you are selling your house and have a prospective buyer hire an inspector, and the buyer for whatever reason, does not buy your house, you should strongly consider requesting a copy of the inspection report.
Often, real estate agents will refuse to accept a copy of the buyer’s inspection and will advise the seller, in this case you, to refuse to accept the report. As a seller, you are probably being told that if you don’t receive the report, you don’t have to disclose the report or anything in the report. This can set the stage for lawsuits.
As a seller, another pitfall that you can fall victim to is taking the advice to have your house inspected under what is known as a pre-listing inspection. Pre-listing inspections are a great way to discover any major defects or repairs that your home might need that you were unaware of while living in or owning the house if… you intend to make proper repairs prior to actively selling your home, and you disclose the entire report to any prospective buyer, and you insist that the buyer of your home hire their own inspector.
If you throw the report in the trash because you don’t like the results, if you do shoddy repairs that conceal the true deficiencies, or you represent the condition of your home via the pre-listing inspection, this can set the stage for lawsuits.
A prudent home seller will always insist on the prospective buyer hiring their own inspector. To reduce the risk of a lawsuit, the smart seller will allow the buyer to choose ANY inspector of the buyers choosing. What does this mean? In the selling and buying of real estate, of all the vendors and entities, the choice of the real estate inspector, home inspector, fee inspector, property inspector, or what is often simply referred to as the inspector, is one of the most critical choices that is made. As a buyer, it should be obvious that an experienced, thorough, and conscientious inspector is the most desirable. As a seller, this may not be so obvious. When a homeowner sells his/her home, the greatest risk of a buyer filing a lawsuit against the seller, is when the buyer moves into the home and discovers undisclosed defects. This should emphasize to you, the seller, that the most thorough inspector available to the buyer, is the inspector you want your buyer hiring as their inspector, as their discoverer of defects in your home. A thorough inspector, working for your buyer, is actually reducing your risk of being sued after you sell your home. A thorough inspector may result in you being required to complete more repairs to your home, or re-negotiate the price of your home, however, this ‘up-front’ cost is miniscule in comparison to the cost of being sued.
How can you, as a seller, reduce your risk? Be in control of the process. Be aware of all of the items discussed above, in the ‘Are you at risk?’
Ask your buyer if they chose their own inspector as a result of doing research on the Internet, thru the phone book, or by choosing from a complete list of inspectors produced by trade associations.