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Suppose you find yourself wondering about the necessary disclosures when selling a house in Texas. In that case, it likely means that you are aware of certain issues with your property and are contemplating whether or not to include them in your Seller’s Disclosure Statement. The Official Representative of Greater Houston Houses gives a straightforward answer that you should always disclose any problems or concerns related to your home that you are aware of when selling it.
The blog is intended for general information as shared by the official representative of Greater Houston Houses and does not represent any legal advice.
Understanding the Seller’s Disclosure and its Significance:
If I tell you to check out the Texas Property Code, you will understand that most home sellers are obligated to complete a Seller’s Disclosure form. The purpose of this form is to disclose any known issues with the property being sold, providing potential buyers with crucial information and a historical account of the home. If a seller fails to provide a Seller’s Disclosure within the specified timeframe stated in the sales contract, the buyer has the right to terminate the sale without facing any financial consequences.
As per my understanding, there are a few statutes that you must consider:
The relevant statute: The Texas Property Code, specifically Title 2, Conveyances, Chapter 5, Conveyances, Subchapter A, General Provisions, outlines the requirements for a Seller’s Disclosure. To get a comprehensive understanding, you can refer to the official documentation. In summary, residential owner-occupants must always complete a Seller’s Disclosure when listing their home for sale.
Sec 5.008 – Seller’s Disclosure of Property Condition (a): A seller of residential real property comprising not more than one dwelling unit located in this state shall give to the purchaser of the property a written notice as prescribed by this section or a written notice substantially similar to the notice prescribed by this section which contains, at a minimum, all of the items in the notice prescribed by this section.
Available forms: There are two commonly used Seller’s Disclosures in Texas. One is the standard Texas Real Estate Commission (TREC) Seller’s Disclosure form, which can be found on the TREC website. The other form is more comprehensive and is provided by the Texas Association of Realtors (TAR), exclusively for its member agents. Sellers should always complete the appropriate form themselves, regardless of whether they are using a Realtor or selling their home independently.
Are there any exemptions from completing a disclosure?
I would suggest, while there are certain exceptions to the requirement of filling out a Seller’s Disclosure, standard owner-occupants are always expected to complete one. This obligation remains even if they choose to sell their home without the assistance of a Realtor. Additionally, landlords are not exempt and must also complete a Seller’s Disclosure.
Here, I would like to share the excerpt below from the Texas Property Code lists the cases where a Seller’s Disclosure is not necessary:
Sec 5.008 (e):
This section does not apply to a transfer:
(1) pursuant to a court order or foreclosure sale;
(2) by a trustee in bankruptcy;
(3) to a mortgagee by a mortgagor or successor in interest, or to a beneficiary of a deed of trust by a trustor or successor in interest;
(4) by a mortgagee or a beneficiary under a deed of trust who has acquired the real property at a sale conducted pursuant to a power of sale under a deed of trust or a sale pursuant to a court-ordered foreclosure or has acquired the real property by a deed in lieu of foreclosure;
(5) by a fiduciary in the course of the administration of a decedent’s estate, guardianship, conservatorship, or trust;
(6) from one co-owner to one or more other co-owners;
(7) made to a spouse or to a person or persons in the lineal line of consanguinity of one or more of the transferors;
(8) between spouses resulting from a decree of dissolution of marriage or a decree of legal separation or from a property settlement agreement incidental to such a decree;
(9) to or from any governmental entity;
(10) of a new residence of not more than one dwelling unit which has not previously been occupied for residential purposes; or
(11) of real property where the value of any dwelling does not exceed five percent of the value of the property.
Are there any exceptions to disclosure requirements?
If you talk about exceptions, I would say, yes, there are a few exceptions.
Sec 5.008: According to Sec 5.008 of the Texas Property Code, there are certain scenarios where a seller or seller’s agent is not obligated to disclose specific information. A seller or seller’s agent does not have a duty to disclose or release information related to a death caused by natural causes, suicide, or an accident unrelated to the condition of the property. Similarly, they are not required to disclose the HIV status of any occupants of the property. Furthermore, sellers cannot be held responsible for conditions that they genuinely have no knowledge of.
Sec 5.008 (c): A seller or seller’s agent shall have no duty to make a disclosure or release information related to whether a death by natural causes, suicide, or accident unrelated to the condition of the property occurred on the property or whether a previous occupant had, may have had, has, or may have AIDS, HIV-related illnesses, or HIV infection.
Sec 5.008 (d): The notice shall be completed to the best of the seller’s belief and knowledge as of the date the notice is completed and signed by the seller. If the information required by the notice is unknown to the seller, the seller shall indicate that fact on the notice, and by that act, is in compliance with this section.
Should you disclose previous fire incidents?
In my opinion, yes, in Texas, you are required to disclose any previous fires that have occurred in your home, regardless of whether mechanical issues caused them or if the damage has been repaired. The Seller’s Disclosure form includes a specific question regarding “Previous Fires.” If you are aware of any past fires, it is necessary to disclose them when selling the house. It is important to note that selling a house with fire damage may require additional considerations.
Do you need to disclose foundation repairs?
I am sure that when selling a house in Houston, you must disclose any previous structural or roof repairs, including foundation repairs. The TREC Seller’s Disclosure form asks if you are aware of “Previous Structural or Roof Repair,” which encompasses foundation repairs. The TAR Seller’s Disclosure form is more direct, specifically asking if you know of any “Previous Foundation Repairs.” If you are aware of any current or past foundation issues, it is mandatory to disclose them when selling the house. It is crucial to consider the implications of foundation repair issues on the sale process.
Do you need to disclose water damage?
I feel, in Texas, you must disclose any previous water damage or water penetration issues when selling a house. The TREC Seller’s Disclosure form includes questions about “Previous Water Penetration” or “Previous Flooding.” Similarly, the TAR Seller’s Disclosure form asks about “Water Penetration,” specifically inquiring about “Previous Flooding into the Structures” and “Previous Flooding onto the Property.” If you have knowledge of any prior flooding or water penetration incidents, it is essential to disclose them when selling the house. Understanding the implications of selling a water-damaged property is crucial.
Do you need to disclose termite infestation?
Of course, the Seller’s Disclosure forms explicitly ask about termites and related issues. The TREC Seller’s Disclosure form asks if you are aware of “Active Termites (includes wood-destroying insects),” “Termite or Wood Rot Damage Needing Repair,” “Previous Termite Damage,” or “Previous Termite Treatment.” The TAR Seller’s Disclosure form includes similar questions, worded slightly differently. If you have knowledge of any termite issues, current or previous, you are obligated to disclose this information when selling the house.
Do home inspectors find all issues?
Home inspectors play several incredible roles in identifying potential issues with a home. However, they can only inspect what is accessible to them at the time of the inspection. Some problems may go unnoticed during the inspection, especially if they are not apparent or occur under specific conditions. For example, if there is a window that leaks during heavy rain, it may not be evident during a sunny day inspection. The Seller’s Disclosure serves as a means for you, as the seller, to disclose any known issues with the home that may not be detectable during a standard inspection. The inspector’s role is to identify issues that a typical homeowner or buyer may not be able to discern.
The consequences of failing to disclose
I think failing to disclose known issues with a property can have severe consequences. In Texas, the Seller’s Disclosure survives the closing of the sale, which means that even after closing, the buyer can hold the seller responsible for undisclosed issues. In such cases, the buyer may choose to file a lawsuit against the seller, potentially leading to legal ramifications. It is always in the seller’s best interest, to be honest and transparent in their disclosure to avoid potential legal issues.
Consideration for small items
See every home has some minor issues, generally, it is advised to fix them before listing the property for sale. Small issues like a sticking drawer or a small hole in the drywall may seem insignificant, but they can create an impression of neglect or potential hassle for buyers. It is generally best to address these small items before listing the home for sale. When in doubt about whether to disclose a particular item, it is recommended to err on the side of disclosure. However, when it comes to our Greater Houston Houses, you need not make any minor issues, repairing, or remodeling before selling. Because Greater Houston Houses buy damaged and flooded houses in ‘as is’ condition.
Dealing with major issues
If your home has a significant problem or issue that you know will impact its sale, there are a few options to consider.
- One option is to repair the issue before listing the home, although this may involve additional expenses.
- Another option is to reduce the listing price to compensate for the repairs the future buyer will need to undertake.
However, it’s important to note that significant issues can prolong the sales process, as buyers may be hesitant to take on extensive repairs. Alternatively, you can sell your home to a professional House Buyer who specializes in purchasing properties as-is, even with catastrophic issues such as fire damage or flooding as is the case with us at Greater Houston Houses. We ensure that the deal can be closed quickly within 3 working days without any repairs. If you reside in the Katy or Houston, Texas area, you can explore this option by requesting a free, no-obligation offer for your home by us.
Honesty and transparency in disclosure
In summary, when selling a house in Texas, it is crucial, to be honest and transparent in your Seller’s Disclosure. Disclosing any known issues, including previous fires, foundation repairs, water damage, and termite infestations, is mandatory. While home inspectors play an important role, they may not uncover all issues, which is why the Seller’s Disclosure is necessary for sellers to provide comprehensive information to potential buyers. Failing to disclose known issues can lead to legal ramifications, as the Seller’s Disclosure survives the closing of the sale. It is also advisable to address small issues before listing the home, and if there are significant problems, exploring alternative selling options may be worth considering. By prioritizing honesty and transparency, sellers can navigate the selling process with confidence and integrity.
Disclosing repairs and improvements
In addition to disclosing any major issues or damages, it is also important to disclose any repairs or improvements that have been made to the property. This includes renovations, upgrades, or any other modifications that may have been done. Buyers are interested in knowing the history of the property and what work has been done on it. Disclosing repairs and improvements can give buyers a sense of the property’s maintenance and upkeep over time for Selling a House in Texas.
Property condition and selling price
When selling a house, it’s important to consider the condition of the property and how it may affect the selling price. If the house has significant issues or is in poor condition, buyers may expect a lower price to account for the necessary repairs or renovations they will have to undertake. On the other hand, if the house is well-maintained and in good condition, it may justify a higher asking price.
Seller’s Disclosure Protection
The Seller’s Disclosure form provides protection for sellers as well. By disclosing known issues upfront, sellers can avoid potential legal disputes and claims from buyers after the sale. If sellers are honest and thorough in their disclosure, buyers have the opportunity to make informed decisions about whether to proceed with the purchase or negotiate terms based on the disclosed information.
Professional guidance and legal advice
Selling a house can be a complex process, especially when it comes to disclosure requirements and legal obligations. It is advisable to seek professional guidance and legal advice to ensure compliance with local laws and regulations. Real estate agents, attorneys, or other professionals experienced in residential transactions can provide valuable assistance in navigating the selling process and ensuring that all disclosure requirements are met. You know, this requires the commission, brokerage, fees, and other legal expenses. However, when we manage a deal, there is no such thing as extra expenses, our transactional system is very transparent and there are no hidden fees at all Selling a House in Texas.
The importance of open communication
Open communication between sellers and buyers is crucial throughout the selling process. Buyers may have questions or concerns about the property, and sellers should be prepared to address them honestly and promptly. Maintaining transparency and open lines of communication can help build trust and facilitate a smoother transaction. All the information that I am sharing here is based on my knowledge, experience, and practices related to selling a house in Texas.
Reach Out to Greater House Houston for Selling a House in Texas
In the process of selling a house in Texas, navigating the disclosure requirements can be a crucial aspect of the transaction. It’s essential to understand what needs to be disclosed and ensure compliance with the law. If you’re selling your home in the Greater Houston area and need guidance, then, we at Greater House Houston are here to help. Our team of experienced professionals understands the intricacies of Texas real estate laws and can provide valuable insights and assistance throughout the selling process. Whether you have questions about disclosure obligations or need support with other aspects of the sale, we are dedicated to ensuring a smooth and successful transaction. Contact Greater House Houston today and let us assist you in selling your house with confidence and peace of mind.