Buying a Washington Home: What Does the Seller's Disclosure Form Tell Me?
Here's what you can learn from reading the home seller's disclosure form -- and what you might need to investigate further.
Washington’s seller disclosure laws require (with few exceptions) that a seller of residential real property provide you, the buyer of that property, with a standard list of seller disclosures before the closing date. (See, Revised Washington Code Sects. 64.06.020 and 64.06.015.) These disclosure laws were designed to protect you, by making sure the seller is upfront about the condition of the property’s structure, systems, and various appliances.
The seller disclosure laws are an improvement on the “buyer beware” concept that was in place before these laws, but the legal protections may not be as complete as you think. Though sellers are no longer free to remain silent on things like leaky roofs, cracked foundations or other dangerous conditions, you will want to understand the limits of the disclosure laws and learn where to ask further questions or conduct other follow-up.
How Washington’s Seller Disclosure Laws Help Buyers
Washington law sets forth the exact language to be used within the standardized disclosure form. The home seller will fill out and give you this form before you close your purchase. The form is designed to benefit you by helping you determine whether the property will offer you a safe, secure, and affordable (depending on how many fixes you have to make) investment. The disclosure statement outlines important property-related categories for the seller to provide information about, from the property’s source of water to whether there is any structural damage to the home.
Once you and the seller have both signed a written agreement for the purchase of the property, the seller has to give you a copy of these disclosures within five business days. After that, you are allowed three business days in which to rescind (cancel) your purchase agreement with the seller. In theory, you would cancel because of something you found out about the property through the seller disclosures – for example, that there’s moisture damage around the windows, which you don’t want to deal with.
In reality, however, you can cancel for any reason at all, even if it is unrelated to the disclosure statement, so long as you cancel within the given time frame. So, for instance, if something on the disclosure statement catches you completely off guard and the reality of the property turns out to not be what you were expecting, you don’t have to go through with the purchase as long as you give written notice to the seller within the cancellation time frame.
Some would argue that this option to cancel the agreement operates to discourage sellers from accurately completing the disclosure statement or providing you with one at all. If, however, you do not specifically waive your right to receive the disclosures from the seller and the seller still does not provide them to you, you can cancel your agreement with the seller at any time up until the date set for closing.
Once the sale closes, you are no longer able to cancel your purchase agreement under the protection of the seller disclosure laws. (You may, however, be able to sue the seller over items that should have been disclosed and were not.)
Information That May Be Missing From the Seller Disclosure Statement
While the seller disclosure statement will likely prove helpful to you, it might not tell you as much as you would expect.
For starters, information on whether registered sex offenders live nearby is not part of the seller disclosure statement. This information can (in accordance with a federal law called Megan’s Law) be obtained from local law enforcement agencies or from the Washington Association of Sheriffs and Police Chiefs website.
The disclosure statement has been updated several times, including in 2007 and 2009. The updates have added new areas for disclosure. Make sure that your home seller used the most updated version in order to address all of the latest disclosures.
Even if the disclosure statement is fully completed and delivered, you have a mere three business days – unless you and the seller have decided on a longer period – to evaluate the form’s numerous questions and subparts, perform further research, and decide whether you are going to rescind. If you want to get a second opinion regarding any of the items disclosed, it will probably take experts longer than a mere three days to diligently inspect and confirm the many different aspects of the property.
That doesn’t necessarily mean you’re stuck, however. You will likely (depending on how your purchase contract is written) have time to hire a professional inspector and negotiate over the costs of needed repairs. If these negotiations fail, your inspection contingency likely gives you a further opportunity to cancel the sale based on issues with the physical condition of the property.
Additionally, for certain disclosure categories, the seller is asked to attach any supporting paperwork that is not otherwise available through public record. If, however, the seller does not attach paperwork, you would need to find the information for yourself and be able to review it within the timeframe given for cancellation. Another possible issue is that, if the seller does not know how to respond to one of the disclosures and asks someone for advice, if the advice that person gives is incorrect, you will not be getting correct information.
Information That May Not Be Revealed on the Disclosure Statement
Even a fully filled-out disclosure statement may not tell you everything you need to know about the property. The main issue of concern is that sellers do not have to disclose issues that they themselves are not aware of. For instance, if a problem with the home’s foundation was slowly developing but hadn’t yet started to show itself, the seller would probably not know about this and would not, therefore, put it on the disclosure statement. You would have no real way of knowing about the issue unless you had the home professionally inspected (a wise thing to do, as discussed below).
Aside from a seller having no idea about a problem, he or she might also be willfully blind to problems. The disclosure statement contains standard “yes” and “no” boxes, but also an “I don’t know” box. A seller who should suspect a problem — who, for example, has noticed some wet spots in the yard but never actually had the sewage pipes examined — might be inclined to simply answer “I don’t know” when asked about such defects.
Or, a seller who hasn’t paid much attention to home maintenance — for example, hasn’t looked up at the exterior of the roof, nor peeped into the attic for years — may actually know very little about the house’s condition. That roof could contain dozens of small leaks, and all the seller would be legally obligated to tell you about them is “I don’t know.”
What Should You Do to Learn the Most About Your New Home?
For a successful property purchase, find out as much as you can about the property before you close the deal. The seller disclosure statement will be a helpful starting point, but it is also a good idea to make sure your purchase agreement includes the right to get one or more home inspections done during the escrow period — as part of an “inspection contingency,” which will also give you the right to back out of the deal or negotiate for repairs or a reduced purchase price if the inspections reveal any defects or issues that you’re not happy about.
For more information on home inspections, see the “Home Inspections and Appraisals” section of Nolo’s website.