Alabama Home Buyers, the law is NOT on your side

This article was originally posted on DothanHomeSearch.com

Alabama is one of the few remaining Caveat Emptor (“Buyer Beware”) states, and recent court decisions have put more emphasis on this fact. If you are buying real estate in Alabama, state courts have said that what you sign for at the closing table is what you get.

In one case in Baldwin County (more information here, page 2), the Alabama Court of Civil Appeals ruled that a listing agent was not liable for damages, even though they knowingly misstated the zoning of a lot. Check out the link above for details of the case, but in short, a listing agent represented two lots as being zoned commercial, even though he found out after listing the property that one of the lots was zoned residential. The buyer, a dentist looking to build an office, sued after closing because of this. The court ruled in favor of the agent because the buyer had signed an AS IS contract. Alabama courts historically have ruled that AS IS means just that.

From Charles Sowell, General Counsel for the Alabama Real Estate Commission-

Caveat emptor (let the buyer beware) as spelled out by Alabama courts means that sellers and their agents in used real estate transactions, as opposed to new construction, have no duty to disclose defects in the property. The main exceptions to this are if a fiduciary relationship exists between the parties; if a buyer specifically inquires about a material condition concerning the property; or if there are defects or conditions known to the seller or any agent involved, but not known to or readily observable by the buyer, which said defects affect health or safety.

As a buyer, there are a couple of rules you can follow to protect your interest. First, anything that is of importance to you as far as making your decision should be made a contingency in the contract. If you are concerned about lot lines, then a survey should clear that up. If your concern is mechanical systems, an inspection by a licensed contractor would be in order. Second, work with a buyers agent. Doing so means your agent has a fiduciary duty to look out for your best interest. It puts a lot of burden on the agent to look out for you and use their expertise to help you try to avoid potential problems.

You should always have the opportunity in the contract to perform any inspections you deem necessary. Use this right to your advantage and learn all you can about what you are buying, because once you sign on the dotted line, its yours.