Selling an Ohio Home: What Are My Disclosure Obligations?

If you are getting ready to sell your Ohio house, you probably know that the task involves completing some paperwork. Whether you choose to use a REALTOR or go it alone, you likely need to complete a so-called "Residential Property Disclosure Form," which advises buyers about the house's physical defects and related issues. With all the effort involved in selling a house, you might be inclined to rush through this form, but there are good reasons to give it your full attention, as discussed in this article.

Let's take a closer look at:

• what the law requires Ohio home sellers to do concerning property disclosures (an overview)
• which Ohio homeowners don't need to worry about making disclosures before selling
• what types of information Ohio's disclosure form asks sellers for
• limitations on what Ohio home sellers must disclose
• strategic reasons to disclose more rather than less detailed or minor matters
• timing of making disclosures
• additional federal law requirements concerning making disclosures about lead in the home, and
• risks of not complying with Ohio's real estate disclosure law

Ohio Law on Residential Property Disclosures

Ohio's disclosure requirement comes from its legislature, specifically a law called Ohio Revised Code § 5302.30. It mandates filling out a Residential Property Disclosure Form, which is meant to alert prospective home buyers to known problems with the property: roof leaks, electrical troubles, malfunctioning appliances, pests, and so on.

The form is used only in the sale of residential property with one to four dwelling units. It applies not only to regular sales but to land installment contracts, leases with option to purchase, exchanges, and leases for a term of 99 years and renewable forever.

Which Ohio Home Sellers Need Not Fill Out the Disclosure Form

Not every seller of residential property in Ohio is required to complete the disclosure form. You need not do so if the home sale you're involved in is either a:

• forced sale, such as a foreclosure, bankruptcy, probate transaction, or eminent domain
• transfer from one co-owner to another
• transfer to someone who has lived in the property for the previous two years
• family transaction, such as between spouses (including divorcing spouses), children, or parents, or
• a house that you own via inheritance but have not occupied within the last year.

What the Ohio Seller's Disclosure Form Covers

The form you will need to fill out as an Ohio home seller covers many types of items and issues, from legal to structural to environmental, in accordance with both law and local custom. Here's a summary sampling:

• water supply
• sewer system
• roof
• water leakage or accumulation problems
• foundation
• basement / crawl space
• floors
• interior and exterior walls
• termites and other wood-destroying insects
• electrical system
• plumbing
• heating
• air conditioning
• fireplace and chimney
• built-in appliances, like a water softener, security system, microwave, or oven
• any oil, gas, or mineral right leases on the property
• in cases where the property is within a community run by a homeowner's association, any new proposed assessments, fees, or abatements
• lead-based paint
• asbestos
• urea-formaldehyde foam insulation
• radon gas
• underground storage tanks
• wells
• flood plains
• erosion
• zoning violations, and
• issues with boundary lines.

At the end of the form, sellers are asked to mention any additional "material" defects; that is, problems that could cause a buyer to not buy the property because of anticipated costs to repair or replace. Material defects are also things that are potentially dangerous, such as contamination, loose boards, areas where people could fall and get hurt. By including an "other" section, the form obviously intends sellers not to leave out any problems that don't neatly fall into one of the existing categories on the form.

What Ohio Sellers Need Not Disclose

Ohio disclosure law requires sellers to disclose only those material defects or other information that they actually know about. This means that you aren't required to get an independent inspection to complete the form, only to list what you actually have learned and observed about the house through having lived there and taken care of it.

In other words, you will need to mark down any material (non-trivial) items you know about, like loose back steps and a microwave that doesn't work. But you don't need to worry about things you don't know about, for example if your neighbor, unbeknownst to you, built the new backyard fence a few inches on your side of the property line. And you don't need to worry about non-material defects, such as chipped paint or a small dent in the wood flooring.

Also, if the problem is open to observation, like a water stain in the ceiling that could be seen by anyone walking under it, then the seller does not have to disclose it; but there's no harm in doing so, and it could foster buyer trust.

The seller must not do anything to conceal or prevent the buyer from investigating a problem, like locking an entry door to a garage or putting out air fresheners to mask odors. The seller must also not engage in fraud, nor falsely deny, if asked, that a problem exists.

Strategic Reasons to Over-Disclose

When in doubt; for example, if you have heard scrabbling in the attic but aren't sure what it means, it's better to disclose what you know than to conceal the truth and potentially face a later lawsuit for fraud or nondisclosure. The law does require sellers to act in "good faith" when completing the form, so looking for excuses not to disclose something might not match that standard.

Also realize that the buyers, knowing that you aren't obligated to inspect or provide comprehensive information about the property, will likely want to obtain an independent inspection and title search prior to finalizing the home purchase.

Lead Disclosure Required Under Federal Law

If your house was built before 1978, you will need to comply with federal law about lead-based paint. The law is called the Residential Lead-Based Paint Hazard Reduction Act of 1992 (U.S. Code § 4852d), also known as Title X. It requires sellers to tell buyers about all known lead-based paint and hazards in the house. Sellers must also give buyers a pamphlet titled Protect Your Family from Lead in Your Home prepared by the U.S. Environmental Protection Agency (EPA). Sellers must allow buyers ten days to test the house for lead.

Your contract will need to include warning language about the lead-based paint. You will, as the seller, need to keep copies of the signed acknowledgement for three years after the sale is completed.

Failing to comply with the requirements carries a stiff penalty for sellers. The buyer can sue for triple the amount of damages actually suffered.

By When Ohio Sellers Must Deliver the Disclosure Form to Buyers

Ohio real estate sellers are required to give a completed disclosure form to prospective home buyers (that is, to people with whom they might enter into a purchase contract) "as soon as is practicable." (See Ohio Revised Code § 5302.30(C).) If the buyers sign a purchase contract before receiving the disclosures, they can rescind the contract. They would need to do so within three business days.

Risks and Penalties of Not Complying With Ohio's Disclosure Law

Ohio's disclosure statute does not set out penalties or any civil causes of action (bases to sue) against sellers who don't comply. However, a disgruntled buyer could find bases to file suit outside of the statute, such as for breach of contract or fraud. Consult an attorney to learn more.