What to Know if the Seller's Disclosure Needs to be Revised
When your seller client fills out the Seller’s Disclosure Notice (TAR 1406), he discloses what he knows about the property. But what happens if something about the property changes after the form is filled out?
While the Texas Property Code does not create a continuing duty or obligation to update the Seller’s Disclosure Notice, if information in the notice is no longer true, the seller may have a common-law duty to correct any misstatements or false impressions.
Whether it’s a recent storm damaging the roof or the seller learning about a previously unknown problem with the property, the additional information can be noted in the Update to Seller’s Disclosure Notice (TAR 1418). The form has space for the seller to rewrite relevant sections of the seller’s disclosure, ensuring he is providing the most current information about the property.
Absolutely. Seller could be subject to a violation of the DTPA if it was proved that a problem, especially a material defect, was concealed by not updating. The definition of “duty” is a moral or legal obligation; a responsibility.
WHAT? Another form? Seller’s Disclosure should be true and effective on the date it is signed. It should be assumed that when seller signed and dated the Disclosure, they did so in all honesty, and should not be held responsible for any defects (latent) that may show after the date Disclosure was signed. Buyer should be made aware of this. Thus, have the Disclosure notarized. P.S. I was taught to leave the room and/or NOT be around when seller fills in the blanks on the Disclosure, i.e., not to offer any advice on how to fill out the form
If your seller receives an offer on the home, and an inspection was conducted, and to negotiate repairs that inspection was given to the Seller. That seller now has been informed of the repairs that are now needed on the home If the sale falls through, then the Seller has an obligation to disclose the new findings.
Understand ..but dos the seller have to give usca copy of the original report. To verify or is it only because they say it
Agents should stop acting like they have nothing to do with the SDN, and start providing a true service to their clients. The Agent is there to give advice, not to “fill out the form.” If the date on the SDN is not current when a contract is signed, then the seller should be advised to fill out a new SDN. ~In today’s market, most properties are selling pretty quickly and it is not an issue. But I have seen SDN’s that were 3 month’s old. Many times the buyer will sign and execute a contract without knowing how old… Read more »
Prior to signing a seller’s disclosure at the time of an agreed contract Buyer should request that Seller update the form. That is the only way Buyer can be sure the information is current.
Maybe have seller sign and date and have notarized the SDN and present the form along with the IABs? No? Yes? Maybe, but …?
Notarizing is only necessary if a document is to be filed in the court records.
According to researching for Texas SDN: Seller disclosures in Texas are governed by Texas Property Code Section § 5.008. That statute provides: “A seller of residential real property comprising not more than one dwelling unit located in this state shall give to the purchaser of the property a written notice” of material defects in the property. The statute asks sellers to use the disclosure form developed by the Texas Real Estate Commission (TREC) THIS NOTICE IS A DISCLOSURE OF SELLER’S KNOWLEDGE OF THE CONDITION OF THE PROPERTY AS OF THE DATE SIGNED BY SELLER AND IS NOT A SUBSTITUTE FOR… Read more »
Depending on who is presenting the completed Seller’s Disclosure Notice, and to whom, the Information About Brokerage Services form may very likely have already been presented to the buyer, or may not be required. These two forms have quite different requirements, with different timelines. Certainly, they could both be on a licensee’s checklist, but to tie one to the other serves no useful purpose, is unnecessary and may cause confusion for the buyer, or a violation for the licensee.
If my memory serves me right, don’t we have a new from the amendment to the seller disclosure so we can make corrections to the sellers disclosure.
Yes we do Barry!! Finally…makes it easy to add docs,etc.
Don’t we have a new form, an amendment to the sellers disclosure where any changes can be made instead of regenerating a new sellers disclosure.
It is mentioned above in the article.
TAR 1418 (2-01-18) Update To Seller’s Disclosure Notice, for use in additional disclosure of anything that was not previously disclosed or discovery of something recently occurred. This form also requires the signatures of both Parties Seller and Buyer.
Remember, TAR forms are courtesy forms, good forms, but not required. Actually, the TAR SDN is very thorough.
The main duty of a notary is to help prevent fraud by witnessing the signing of documents and verifying their authenticity. Notaries don’t verify content so having the form notarized really doesn’t do anything except authenticate signer’s signature.
The issue of full disclosure is simple, but when overzealous, inexperienced inspectors give a myriad of subjective opinions and suggestions that are often refuted by licensed contractors, it muddies the water of what a seller “knows” about a property. I know my AC works fine, but when a prior inspector states that the unit is old and should be inspected by an HVAC guy, even though he offers no specific reason other than age of unit, do I have an obligation to disclose that to subsequent lookers? Multiply that by other subjective opinions, and I’m scaring off potential buyers before… Read more »
If the inspector advises that an item should be inspected further, he is not reporting a defect, he is just doing what we all do, that is , telling a buyer he should have the property inspected further. Reporting to a prospective buyer that a property does not comply with a current code, but it did comply at the time it was built is not a defect. It would be an upgrade, unless that particular item has been declared illegal by the state, for example a cesspool. It is my understanding, any new defects should be updated on the SD
The bottom line is DISCLOSE, DISCLOSE, DISCLOSE!!!! Disclosing everything you and the seller know, whether it is on the original Seller’s Disclosure or comes to your attention later means two things: 1. You and your seller are being honest and making a sincere attempt to do the right thing. 2. You are protecting yourself and your client by following the SPIRIT as well as the letter of the law.
Being that Disclosures in Texas are governed by the Texas Property Code Section 5.008 statute I think it wise to follow it as my defense. As previously stated, that statute provides: “A seller of residential real property comprising not more than one dwelling unit located in this state shall give to the purchaser of the property a written notice” of material defects in the property. The statute asks sellers to use the disclosure form developed by the Texas Real Estate Commission (TREC). Inspections are used to negotiate a lower price but in the end, all Residential property is sold AS-IS,… Read more »
The problem I have seen on the buyer’s side of things is when a seller does not fill out the disclosure completely. They pick and choose which items to answer. I always call the listing agent out on it and ask that the form be filled out completely, but they never have. Needless to say, I point that out to my clients and they usually move on to another property, but the listing agents keep pushing the incomplete form onto less educated individuals. There is an issue if the seller is unwilling to respond to all the questions.
Thank you for this piece of information. It’s a good reminder to stay up to date so everyone is treated fairly. I don’t think there is enough disclosure sometimes. Of course issues are hopefully found during inspection, but it is a lot easier if you have a clue to begin with. If the client knows what part the AC unit needs… Write it down with a date if possible. Disclosure is of the utmost importance! I never see one with an extra page that you’re allowed to use for explainations.
if an inspection is done by an unlicensed plumber and not performed correctly, and unable to submit any diagnostic results of the test – Is seller required to disclose the issue without any proof provided?
I recently was involved in a transaction where there were at least 4 evaluations on the square footage of a property that varied over 300 sq ft. The seller and sellers agent were made aware of the problem. My clients were able to get their earnest money back with the Right to Terminate Due to Appraisal doc but the Seller’s Disclosure was never updated to include the discrepancy. Is that a problem?
IN 1995-96 I managed and labored in the construction of a custom home in the Barton Creek Estates of West Travis County for a friend under a homestead permit issued to the friend/owner and allowing them, not to use licensed contractors required by builders. At completion this friend reimbursed many of my expenses and labor by paying me with $30,000 in NSF checks from their drained construction fund account. I sued and the owner with their insurance company won in court by presenting evidence the house was defective with a (1) foundation not designed by an engineer, (2) defective recycled… Read more »
I put an offer on a property and I am within my option period (which ends in 2 days). The inspector found many defects and water damage to the property that wasn’t disclosed in the SDN. Checking the signature date, I noticed the form was signed 5 months ago and the seller claims that the property has been vacant for all those months. Isn’t there a law on how old can a SDN be? I’ve paid $470 for the inspection and $300 for option fee…Is there a way to get a refund of my option fee to reduce my losses… Read more »
Seller’s Disclosure was signed and returned to the sellers agent at the time the offer was made. Under contract now and inspections finished and sellers agent has requested the buyer sign an update to the Seller’s Disclosure. Does not seem to be correct to sign updates after the house is under contract and original disclosure has been signed and returned.