Seller’s Disclosures – Why Georgia Home Buyers Shouldn’t Place Too Much Faith in Them

north Atlanta realtorsMurder, violent crime, natural death, neighborhood sex offenders, meth labs… would these be things the average home buyer might be interested in learning about if they liked a particular home? If so, don’t expect any help from a seller. These and a long list of other things, are not required to be disclosed in Georgia. Things required to be disclosed by home sellers in Georgia are puzzling, right down to the “must be disclosed only if asked” rule. This often surprises home buyers in Georgia. Those using an inexperienced or no agent rarely understand the importance of making good use of the due diligence period.

Meth labs are scattered all across the country, including throughout metro Atlanta. Yet there is NO requirement to disclose that a home has a history as a meth lab. Home buyers in Indiana found out the hard way, after purchase.

The kids were constantly sick and struggling to sleep. The Nugents puzzled over their children’s health problems until a neighbor mentioned that the previous homeowner referred to the bathroom as his “smoke shop.” That’s when Nugent paid $50 for a methamphetamine test. The first test revealed meth levels three times the legal limit. When meth is smoked, dangerous chemicals are released into the air that can cling to clothing, carpets and walls.

Maybe if their agent suggested speaking with neighbors, or the Nugent’s took it upon themselves, this would have been avoided. In the end they moved out and sold the home at a significant loss. Are agents expected to notify buyers in a case like this? Yes, as this is a material fact. But what if the agent isn’t told by the seller and is unaware of the issue?

When a defect is physical (for example, a leaking roof or unsound foundation), the issue is clear. Licensees must disclose. When the defect is emotion (for example, murder or ghosts), the answer varies.

Sellers are not required to complete a “seller’s disclosure” but if they do, there are things about the property the seller does not need to (and in some cases is not allowed to) tell a buyer in Georgia. Sellers do not need to disclose any condition of the property that a buyer would discover upon a reasonable inspection. This would include obvious things like holes in the roof, fire damage or similar, clearly noticed things. Buyers should ask of course, but this is not required.

Sellers in Georgia do not need to disclose certain things that have happened on the property. For example, the seller does not need to tell a buyer if a diseased person ever lived in the home, or if a homicide, felony, suicide, or any other death occurred there (Georgia Official Code Annotated §44-1-16(a)(1)). Additionally, a seller in Georgia is not required to let a buyer know if a registered sex offender lives in the area (Georgia Official Code Annotated §44-1-16 (b)). The seller must answer any direct question a buyer asks about these things honestly (Georgia Official Code Annotated §44-1-16(a)(1)). Curious buyers should ask the seller directly about these things as they are compelled to answer honestly.

Listing brokers must inform you of any known material facts about the property. The broker is not liable for passing on false information from a third party, so long as the broker tells the buyer where the information came from, and does not know the information is actually false (Georgia Code Annotated §10-6A-5(b)(2)). Buyers may find toxins in a “bury pit” that the listing agent was told contained nothing more than trash or a well that contains high levels of contaminants. If the agent was told “everything is fine” and has no knowledge to dispute that, they are not liable for damages. Brokers are also not required to share information on things that occurred in the home. Just as with sellers, if asked, they are expected to answer honestly but there is no requirement to provide any unsolicited information.

The importance of properly using the due diligence period cannot be overstated. Georgia is very much a “buyer beware” state and it’s incumbent upon home buyers to properly and efficiently investigate any home prior to purchase. Needless to say, disclosure items are only the tip of the iceberg when it comes to properly researching a home. Many home buyers have no idea of how many ways trouble can erupt during and after the purchase of a home.

 

Questions? Maybe we should talk.

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