I am often asked if it is necessary to obtain and deliver property disclosure reports to a buyer, although the property is being sold "AS IS".

Well, California has several laws regarding natural hazard, property tax and environmental disclosures during a real estate transaction.                                                                                                      

In general, there are two types of disclosures:

1. Actual Knowledge

You are required to disclose "actual knowledge" if you know of issues that affect the value or desirability of your property. Possible examples are drainage problems or an old heating oil tank on your property or the stone quarry 5 miles down the road whose trucks rumble by at 6:00am every weekday morning. Your agent will provide you with more information on how these disclosures are simply and routinely addressed on a form called the Transfer Disclosure Statement (TDS). This form has a number of questions to answer and you are required by Law to complete it using the best of your knowledge. Your agent is also mandated to make a visual inspection. Don't worry, it's simply a disclosure process an agent is required to undertake. If your home was built before 1960, your agent will also provide you with the "Homeowners Guide to Earthquake Safety" booklet to complete and give to your buyers. Your agent may also be providing other disclosures and booklets to the buyers. These are simply standard items used in today's residential transactions.

2. Public Knowledge                                                                    

Certain public information such as mapped flood zones, environmental information and potential geologic, flood and fire hazards are determined by state and local jurisdictions. Such hazards may be shown on officially published maps in order to make the information available to all.

Disclosure of certain, specific information is mandated by state, local or federal laws, while other publicized information is prudent and advisable to disclose in order to help protect all parties as well as decrease your own liability exposure. There may be other disclosures applicable to your property also. A special tax assessment disclosure requirement pertains to Mello-Ross and 1915 Bond Act districts due, in part to certain accelerated foreclosure provisions.

What are the benefits to You as the Seller?

Disclosure is in the best interest of all parties involved in selling a home. The idea of "Buyer Beware" no longer holds true in today's real estate market. As the Seller, view disclosures in a positive light. It helps protect you and limit your liability. When Buyers are informed through disclosures, there are fewer complaints, miscommunication, and lawsuits. Dealing with disclosure issues from the beginning can help ensure that the transaction will close smoothly with all parties satisfied, when it comes to disclosures.

So, whether it is a For Sale By Owner or an Agent representation real estate transaction, it is always best to obtain the property disclosure reports.

"AS IS" means the Buyer is buying the property without repairs or inspections. Property Disclosures are just that, Disclosures.

Major companies where you may order property disclosures are First American Natural Hazard Disclosures, LGS Reports, and Property I.D.  

So invest a little money wisely and order and obtain these types of reports. Make sure to have a copy delivered to your Escrow Officer, to ensure that it is paid through escrow and/or delivered to the Buyer for approval and receipt of a report as well.