Here’s what can happen when a seller lies on the Seller’s Property Disclosure.
The following actually happened in one of my transactions a couple of years ago.
I represented the buyers in the transaction.
The home looked good on the surface.
We prepared an offer that was accepted by the seller.
I had to request a copy of the Seller’s Property Disclosure from the listing agent when it wasn’t posted in MLS.
That was my first indication of the listing agent’s inattention to details.
The listing agent sent the Seller’s Property Disclosure to me, I carefully reviewed it, and found no disclosed issues.
However, I noticed that only one (male) seller had signed the Seller’s Property Disclosure.
I then searched the public records and discovered that title was held by both a husband and wife.
That meant that our accepted offer wasn’t legally-binding because the offer hadn’t been signed by all parties on title.
The preliminary title report also confirmed that title was held by both a husband and wife.
The wife’s signatures were also missing on the MLS listing and the Seller’s Property Disclosure.
Then, things got even more interesting when the home inspection revealed that the 10-year old roof needed to be replaced due to defective, recalled shingles.
When I notified the listing agent about the roof issue, he told me it “wasn’t a problem” because the seller had already applied to have the roof replaced under warranty.
That confirmed that the seller and listing agent knew of the failed roof and both had misrepresented a known adverse material fact.
The listing agent had also failed to obtain the wife’s signatures on the listing, Seller’s Property Disclosure, and Purchase Offer without disclosing it to me.
The home inspection also revealed a flooded crawlspace, which might not have known to the seller.
The bottom line:
My buyers and I finally realized that we were dealing with a dishonest seller and listing agent, neither of whom could be trusted.
We terminated the transaction with a full refund of my buyer’s earnest money.
Later, I noticed that the home had been sold and reported closed in MLS.
I wonder if the buyer ever learned what I discovered during my failed transaction?