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MARYLAND PROPERTY CONDITION DISCLOSURE STATEMENTS - A RANT!!! #1 in a series.

By Lenn Harley

Real Estate Agent with Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate 303829;0225082372

April 13, 2012 12:54 AM

MARYLAND (and other states) PROPERTY CONDITION DISCLOSURE STATEMENTS - A RANT!!! #1 in a series.

PROPERTY CONDITION DISCLOSURE STATEMENTS have been of great interest since they were first introduced in Maryland in about 1994.

My first comment on reading it was "Mmmmm. This should stimulate a few post settlement lawsuits". Then, after a few years I realized how useless the statements are regarding actual defects.

NOTE TO LISTING AGENTS:
1. I've read enough of them to know when no agent has not reviewed them before making them available.

2. I've read enough of them to identify a discrepancy between the disclosure and the home inspection and when I see a defect identified in the home inspection not disclosed on the statement, that repair WILL BE MADE.

3. If the owner is sufficiently aware of a defect to honestly disclose it in the Property Condition Disclosure Statement, why don't they ALSO make the repairs???

4. Why do so many Property Condition Disclosure Statements have UNANSWERED QUESTIONS??

5. Why do so many listing agents fail to provide the Property Condition Disclosure Statements to prospective home buyers before there is a written offer. HEY FOLKS. Disclosure should be made BEFORE the buyer determines whether or not to even make an offer.

On many occasions, I have called for an appointment to preview or show a home for sale and, when I ask the listing agent if the disclosures are in the property, the answer is likely to be:

1, NOT YET. I'm trying to get the seller to complete it. They've been busy.

QUESTION: Why wasn't the DISCLOSURE completed when the property was listed????

2. Go ahead and show the home, I'll get the Property Condition Disclosure Statements to you as soon as I can.

QUESTION: Shouldn't the buyer have the Property Condition Disclosure Statements available when viewing a home for sale???

3. "It's at the office, just call the office and they'll fax it to you".

QUESTION: Why does the listing agent make the buyer's agent jump through hoops to get a document needed before viewing a property.

4. "Just have your buyer sign a blank form (lead based paint, Property Condition Disclosure Statements, etc.) and send it with the offer." I GOT THIS ADVICE FROM A LISTING AGENT WHEN THERE WAS NO LEAD BASED PAINT DISCLOSURE AVAILABLE.

QUESTION: WHAT??? What's even stranger is hearing the listing agent's "sigh" when I tell them (in a friendly manner of course) that we need the required forms BEFORE preparing an offer.

NOTE: This advisory is printed on the Property Condition Statement.

The owner(s) acknowledge having carefully examined this statement, including any comments, and verify that it is complete and accurate as of the date signed. The owner(s) further acknowledge that they have been informed of their rights and obligations under §10-702 of the Maryland Real Property Article.

IS THE STATEMENT "COMPLETE AND ACCURATE"?? Ah ha!! That is why I want it BEFORE showing the property to a buyer.

Paragraph 40 of the Contract of Sale states:

40. SINGLE FAMILY RESIDENTIAL REAL PROPERTY DISCLOSURE NOTICE: Buyer is advised of the right to receive a “Disclosure and Disclaimer Statement” from Seller (Section 10-702 Real Property Article, Annotated Code of Maryland).

QUESTION: With the requirements for providing the disclosures written in the contract of sale and the clear instructions thereto,

WHY, WHY, WHY do the listing agents and sellers make it so hard to get the documents??? Why, why, why???

NOTE TO AGENTS: There is significant RISK to an agent and their broker if the Lead Based Paint disclosures are not properly provided. I've heard that the HUD fines begin at $60,000.

"Honey, do you trust this disclosure statement with so many blanks? How old is the roof? Why did the basement flood? We need to know."

"I agree Dear. If we don't get a completed statement I don't think we can make an offer. We've waited 2 days now. I don't want our money tied up. Let's call Lenn and tell her we're ready to look at some more homes for sale."

Courtesy, Lenn Harley, Broker, Homefinders.com, 800-711-7988.

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Richie Alan Naggar

people first...then business Ran Right Realty - Riverside, CA

agent & author

If and when I get a call on a listing of mine, I can answer any and all questions plus I have pictures. I have learned not to waste anyone's time. However, I am continually amazed that many operate by the seat of their pants...Professionals don't do that...It is called standard of care and when complied with makes smooth sailing for all...YES....to your post Lenn thank u

Apr 13, 2012 12:59 AM

Lenn Harley

Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA

Real Estate Broker - Virginia & Maryland

Richie. INDEED. You'd think that listing agents would be better and have more pride in how a home is presented and remove the BARRIERS.

Apr 13, 2012 01:13 AM

Brenda Mullen

RE/MAX Associates - San Antonio, TX

Your San Antonio TX Real Estate Agent!!

Hi Lenn-When I list the property, I upload the SD in the additional forms so that it is available for the buyers agent. I get really annoyed when I get a contract that states the buyer hasn't received the SD and I have to point out to the agent that they have had access to it all the time :).

Apr 13, 2012 01:47 AM

Lenn Harley

Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA

Real Estate Broker - Virginia & Maryland

Brenda. Our MLS has that capacity too. However, they are almost always empty.

That said, if the agent can't upload to the system listing, all they have to do is leave copies IN THE HOME FOR SALE.

This isn't rocket science.

I guess my point is that far too many agents proceed in routine, superficial ways and pay little or no attention to the little things that just might help get an offer.

Apr 13, 2012 02:56 AM

Carla Muss-Jacobs, RETIRED

RETIRED / State License is Inactive - Portland, OR

Our seller disclosures are contractual and made a part of our Sales Agreement. There are two provisions that buyers can invoke. 1) If the seller does not provide the sellers disclosure, the buyer may revoke the offer at anytime, (and oddly enough, we get the disclosures quick, fast and in a hurry upon mutual acceptance.) 2) And "upon delivery" of the Seller's Disclosure the buyers can revoke their offer unconditionally within 5 business days of receipt. To me, since it's contractrual, I do not want the disclosures prior to the offer. A lot of agents upload them on the MLS and they think this constitutes deliverly and my clients right to revoke is not based on a document uploaded on a listing sheet when the language is "upon delivery" The listing agnet/brokerage needs to deliver the document so that the time clock of the 5 business days to review and/or revoke starts to click. THEY need to prove they delivered the documents. So, in my local market and standard of practice, there needs to be a mutually accepted offer, the sellers disclosures are delivered to me, my clients have 5 business days to review them and they may revoke the offer unconditionally during that 5 business day.

Apr 13, 2012 03:25 AM

Lenn Harley

Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA

Real Estate Broker - Virginia & Maryland

Carla. The descriptions in your comment would apply to HOW or Condominium docs here but not property condition disclosure. Although the buyer can void the contract even after closing if they're not received.

Apr 13, 2012 05:24 AM

Marnie Matarese

DWELL REAL ESTATE - Sarasota, FL

Showing you the best of Sarasota!

Hi Lenn- How would you like to live in a state in which the property disclosures are available but not required by law?

" A seller isn’t required to fill out a Seller's Real Property Disclosure Statement or any similar form because there is no legal requirement for a seller to give a buyer a written seller property disclosure statement. However, a seller of a residential property, whether a bank or an individual and regardless of whether the seller occupied the property, is obligated under Florida law to disclose to a buyer all known facts that materially affect the value of the property which are not readily observable and are not known to the buyer. The disclosure obligation can be fulfilled via either a verbal or written disclosure."

So is this a requirement with no teeth or what? And how would you interpret it?

We often have sellers who aware of this and refuse to fill them out at all. Why have one if it is not enforceable? Florida can be strange in so many ways. When I take a listing I load every concievable document, disclosure, HOA/COA rules and regulations, floor plans etc. that the MLS has room for. And yes, here as well we have agents who don't even know that attachments can be uploaded and available for them as attachments.

The attitude of many agents here is that they only provide the necessary docs when specfically asked for them and yes, I have also been asked to have the buyer sign the blank disclosure. The paperwork on each deal is almost overwhelming and when it is up to you to chase after what should be readily given, it makes a tough job even tougher.

Apr 20, 2012 11:37 AM

Lenn Harley

Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA

Real Estate Broker - Virginia & Maryland

Marnie. I'm a broker in MD and VA and the laws are quite different. This is a complicated matter and I'm inspired to write a post. I'm working on it.

Apr 20, 2012 08:41 PM

Gary L. Waters Broker Associate, Bucci Realty

Bucci Realty, Inc. - Melbourne, FL

Eighteen Years Experience in Brevard County

In Florida our seller disclosures are not required as noted by Marnie (#7). I think agents have them completed by sellers as a way to cover themselves more than anything else. BTW I rad post number two first in this serie...nice job, Lenn.

Apr 20, 2012 10:10 PM

Tom Bailey

Margaret Rudd & Associates Inc. - Oak Island, NC

Lenn, We are lucky here our MLS requires the statement be uploaded when the property is listed. A fine will follow if not done.

Apr 21, 2012 12:57 PM

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