Disclosure – What responsibilities does the listing agent have?
The discussion over the post by Crystal Pina today http://activerain.com/blogsview/2540966/are-listing-agents-nothing-more-than-overpaid-data-entry “Are Listing Agents Nothing More Than Overpaid Data Entry” got me to wondering how other Listing Agents present disclosures to their Sellers and then how they integrate them into the promotion of the listing itself.
It seems that across the country, we’re given much the same guidelines. Present the blank disclosure to the Seller, inform them of their obligations according to your local laws, and then have them (or with the assistance of their attorney) complete the disclosure. But what do you do with it once they’re finished?
I’ve seen many disclosures where there is no possible way that the Listing Agent ever read the disclosure before either loading it into the database or photocopying it into a brochure for the property. Statements like... where does your drinking water come from (that’s looking for an answer like “a well” or “public water company” or “private water company”... that are instead answered with “from my water line on the refrigerator” really aren’t the intention of the document. Or the upgrade that was noted on a disclosure that the Seller had installed new Prego flooring left me chuckling. Maybe their agent should have reviewed that with them so that it didn’t look like they’d spilled spaghetti sauce on the floor. Or a question that asks if there are any problems with a certain aspect of the house and the Seller just says “yes” but doesn’t elaborate, well that isn’t really a disclosure.
I tell my Sellers that the disclosure documents are their “Get Out Of Jail FREE” card. That I want them to disclose anything they’ve done to improve and anything with which they’ve had an issue. The last thing they want is to tell the Buyer, no, they’ve never had an issue with water in the basement and then have the Buyer move into the property and get to talking with the neighbors who inform them of the following. “Oh sure, we knew the people who lived here before. Why every time it rained, we all formed a bucket brigade in order to get all the water out of their basement!”
I also don’t like my Sellers guessing about things. If they don’t know, then mark it as unknown. Buyer clients of mine who made an offer on a house were happy to see that the electrical system had been upgraded. The disclosure stated that it was a higher amperage. Good news. Then as the home inspector was reviewing the house with them, it was discovered that the electrical service was a mere 100 amps. Not good news for the addition my Buyers were planning for the house. When we brought it to the attention of the Seller via their agent, we discovered that the Seller thought they had 200 amp service because they saw a “2” on a wire. That disclosure cost them about $1500.
Fences, sheds, and other potential encroachments become an issue with disclosure.
“Ms. Seller, are you sure the fence is properly placed with regard to the property line? When you put the shed in the yard, did you consult with an attorney about the setbacks or have someone review your survey?”
No? Then note that the shed may be too close to the property line.
Equally, when I review their document, anything that leaves me wondering about the rest of the story, needs to be elaborated.
“So you said here that you had an issue with the plumbing but it’s been fixed. What was the problem and what did you do to resolve it?”
Take the time as a Listing Agent to fully explain disclosures, to review them, and then... after you electronically load them in the database... to make sure they’re legible.
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