Usually when a buyer is purchasing property or a home, the seller provides a form called a real estate condition report. The seller is legally required to make no mis-representations about the property and its condition.
Sometimes, though, the condition report is not filled out or the contract contains a provision that states "The buyer accepts the property as-is, where-is. Seller makes no warranties, expressed or implied." This happens most frequently in the case of bank-owned properties (foreclosures) or when a personal representative fills out the documents for an estate, but it can also happen in regular transactions as well.
Buyers need to be very aware of what they are signing when they agree to an as-is, where is statement in a contract.
When a buyer agrees to an as-is, where is statement in the contract, they effectively lose their right to sue the seller later for mis-representation. This statement implies that the buyer is purchasing a property that is not in perfect condition and cannot rely on the seller to diclose any or all defects. Wisconsin Court of Appeals recently heard a case regarding a real estate transaction where the seller assured the buyer that the property had a clean environmental analysis, but where there was soil contamination. The buyer signed a contract with an as-is, where is provision. Because of the provision that the buyer agreed to, the court ruled that the buyer was in breech of contract when attempting to back out of the deal.
Buyers should tread carefuly with any offer that has an as-is, where is provision attached. Try to obtain any inspections or testing that could help determine condition prior to submitting an offer. Perfect properties rarely come with the as-is, where is language, so keep buyers need to be aware of any potential hidden risks.
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