Real Estate transactions can be confusing, and so can the disclosure agreements that may be involved. While every transaction is unique, the disclosure agreements they may use are quite common. These disclosures may not always be named as such agreements; for example, you may see this agreement or clause labeled "Condition of Premises". The title may be slightly different, but the main purpose is to let the potential buyers know of any defects or damages that the seller is aware of. Here are a few examples of these agreements and what they may involve:
- No Seller's Disclosure - These disclosure agreements basically outline that the property is being sold with NO release of information concerning any property defects or facts about the property that may be crucial to a potential buyer's decision.
- Seller Disclosure - This is not necessarily an agreement, but rather the seller's compilation of information regarding and damages or defects to the property, as well as any repairs, upgrades, additions, etc. that may have been completed during their ownership of the property.
- Non-Disclosure - These agreements allow sensitive information to be passed from a selling party or individual to an individual that may be interested in the property, in an effort to assist in the sale of the property.
- Full Disclosure - These agreements require that the selling party MUST inform a potential buyer of information regarding the property that may sway the potential buyer's decision to purchase. The information required usually pertains to damages or defects of the property that could affect the value of the property.
While all of these disclosures can be useful in certain situations, the problems arise when a seller or buyer breaches the terms that were laid out regarding the disclosure agreement. For example, if both parties signed a full disclosure agreement ,where the seller claimed to not know of a defect, and the buyer discovers a defect and evidence that the seller was aware of the defect, the agreed upon contract has been breached and there is reason to consider filing a claim. Another challenge is proving that the seller had prior knowledge concerning the damage or defect.
So what is the next step if the contract has been breached and there is evidence to prove prior knowledge? Contact an attorney that handles Real Estate Litigation cases. After a meeting with them and a decision to hire their firm, the next step is to send the opposing party a Demand Letter. A Demand Letter basically notifies the other party that they have engaged in misconduct regarding the agreement or contract, gives them the opportunity to rectify the situation and recommit to the original terms, and tells them what the potential next step in your plan of action may be (ex: lawsuit).
It is always the best idea to consult with a licensed attorney for information regarding breach of contract cases. If you or anyone you know is potentially dealing with a real estate litigation case concerning breach of contract, please feel free to call our office at 740.346.2899 to receive information pertaining to these cases and to Schedule a Consultation with one of our knowledgeable attorneys.