Listing house has its own risks. Not only will you be facing holding costs and commissions, but you can be facing some legal risks as well.
Selling a house isn’t without its own legal risks. Even when the sale is closed and you are no longer the legal owner of the home, you can still be a subject of a lawsuit. Read more if you want to know what legal risks come with selling your house the traditional ways, and how you can avoid them if you sell your house to a direct buyer, such as Sparks Property Investors LLC.
How Can You Get in Legal Trouble after Selling Your House?
When you sell your house the traditional way, there is one important thing you should know: Disclose everything. Even when you are in doubt whether or not the certain issue should be mentioned – disclose. Your real estate agent, as well as your buyer, must know everything that is going on with your property.
Sure, you might think you can hide some minor defect. The buyer won’t notice it at first, and maybe even the inspection will go over it. However, by doing this you are exposing yourself to huge legal risks. Imagine this scenario. A few months before you listed your house, you’ve found holes on the roof. Instead of properly maintaining it, your repairman only patched up the hole and covered the ceiling stains with some paint. It looks good enough and it can fool most inspections, so there is no need to disclose the repair, right? Well, if a few months after the sale the buyer notices leaking and realizes that this is the cause of it, you can be subject to a lawsuit.
By not disclosing everything, the seller may be liable for some of these damages:
Economic Damages – Any expenses that have been made from the buyers pockets, such as repairs or loss of profit
Non-Economic Damages – Compensations for suffering and emotional pain
Punitive Damages – Compensations for intentional non-disclosure
Equitable Relief – This is different than other damages, because it isn’t monetary but rather a court order that the seller should (or shouldn’t) do certain actions.
What Issues Should You Disclose to Avoid Legal Risks?
The short answer is – every single one. You should also disclose every major repair that was done on the house in the past several years, just to avoid scenarios like the one we’ve mentioned. Even if your house loses on its value, this is still better scenario that to have to pay a lot of legal fines for tricking someone into purchasing a property that has more issues than it was believed.
If you’d like to summarize, the problems that you should always disclose include:
- Leaks on the roof.
- Issues with the HVAC system, plumbing, floors, walls, windows, electrical units etc.
- Issues with the exterior, including anything wrong with the lawn, driveway, sidewalks and similar.
- Pest infestation.
- Zoning ordinance violations
- Violations of building code
You should even disclose if anyone died in the property, as this is something that can turn many people away from the property. Especially if the death was violent or suspicious.
Is Your Real Estate Agent a Subject to Legal Risks?
Your real estate agent has the same responsibilities as you do. They are your representative, and they should disclose any property issues to the potential buyer. In no way should your real estate agent conceal or refuse to disclose any of aforementioned problems. However, a real estate agent can also be liable to lawsuits if they didn’t know about some issue, just like you can.
How to Sell Your House and Avoid Legal Risks?
There are a few things you can do to reduce your chance of legal risks when selling your house.
You should always, always disclose every little thing that might cause any issues with your properties. Even if it’s something minor like a small scrape on the paint – disclose it. If you wonder whether or not you should mention something – disclose in anyway. Under no circumstances should you, or your agent, try to hide any issue.
Conduct a Property Inspection
Often times, sellers decide to pay for their own property inspection before listing their house. This inspection is done so they know everything wrong with the property beforehand. Sellers then know everything that can pose a legal risk and they can fully disclose every issue, including things that they might not have been aware of. Keep in mind that inspections can cost a pretty penny, and that they aren’t giving you a 100% certainty that you will avoid possible lawsuits, so some legal risks remains. Even your real estate inspector might miss something that can cause damage to the buyer in months to come.
Make a Direct Sale of Your House
Most direct buyers, such as Sparks Property Investors LLC, buy houses as-is. In other words, they won’t care if you have forgotten to mention some small issue. Some direct buyers won’t even conduct an inspection, which makes it a real as-is purchase. And the best thing is – your legal risks are minimal! Unless there is something seriously wrong with your property, direct buyers won’t mind. Also, they won’t give up on sale if your property is distressed or if there are major repairs needed to make the house functional.
There are many other advantages to making a direct sale of your house. Sparks Property Investors LLC pays in cash, so you aren’t facing the risk of your buyer getting refused by the bank, and you don’t have to wait to get paid. Also, when you sell to a direct buyer, you can close the sale at a timeframe that is fitting for you. This will also save you money on holding costs. Direct buyers will do everything they can to make the sale about you and your needs, which makes them safer, and often times better choice than listing your house.