California Law requires a Transfer Disclosure Statement (TDS). This statement is the means by which residential property sellers disclose details regarding the property involved in the transaction to the buyer, in writing. Disclosure obligations are applicable to all California home sellers regardless of what type of home they are selling (from single family home, condominium, mobile home, etc.) The TDS is one of the seller disclosures that buyers will receive at some point during their contract contingency period.
Specific Information that Must be Included in the TDS Form:
- Any improvements on the property
- Condition of any improvements on the property
- Any defects or malfunctions of the improvements to the property
- Information about all appliances included in the purchase of the home
Information that Should Also be Included in the TDS Form:
- Any room additions
- Any damage
- Any neighborhood noise problems
Both buyers and sellers have a vested interest in full disclosure as encouraged by the TDS form.
Potential buyers benefit from knowing as much as possible about the property they are purchasing so that they can accurately evaluate whether or not they want to finalize their purchase. It is also useful in determining what resources they will need in order to make the purchase viable. The knowledge of any potential repairs and/or upgrades that will be necessary after the purchase of the home is a key factor for many buyers in their decision to purchase or walk away.
Sellers benefit from full disclosure in order to avoid problems post-sale. Sellers who do not include all pertinent information in the TDS form may find themselves in receipt of a demand from the buyer with allegations of: nondisclosure, fraud or concealment. Avoiding such complications is easy: disclose all relevant issues. Sellers are not warranting the condition of the property when completing the TDS form. They are only stating its current condition.
For additional information regarding disclosures during the purchase of a property and how to handle non-disclosure, contact the southern California real estate attorneys at The Law Office of the Law Office of Ernesto Aldover.