REAL ESTATE DISCLOSURES – Remembering the “Why” Behind the Tedium
February 16, 2010
Capt. Renault: What in heaven’s name brought you to Casablanca?
Rick: My health. I came to Casablanca for the waters.
Capt. Renault: The waters? What waters? We’re in the desert!
Rick: I was misinformed.
–SCENE FROM CASABLANCA (photo courtesy of Actionflik)
Though the above exchange makes light of not having full or accurate disclosure when moving or relocating, I find myself at times annoyed with the seemingly massive amounts of disclosure paperwork. CA seems to come out with several new ones a year! But its when I come to the Megan’s Law Database Disclosure in particular, that I take a deep breath, remembering the “why” behind the real estate dislcosures that I advise my clients to suck it up and fill out or thoroughly read the docs. Someone’s life at some point and time was drastically changed by the lack of disclosure to create enough of a statewide or national concern for a law or statute to be enacted. There was time, money, inconvenience or some type of tragedy that could’ve possibly been prevented had there been a law of full disclosure in place. The following are just a few real estate disclosures that may or may not be required by law in your neck of the woods.
Megan’s Law Database Disclosure is a “head’s up” type of disclosure that notifies buyers that neither seller or brokers are required to check the offender websites for offender location in and around the subject property. It advises buyers that seek such information to seek it during contingency periods. Megan’s Laws are state and federal statutes that require convicted sex offenders to register with local police and to notify law enforcement authorities whenever they move to a new location. What a tragedy for the Kanka family to discover after their beautiful daughter’s horrific death, that a twice convicted sex offender moved across the street from them. There is such a need for this type of disclosure that the Megan’s Law Statute Could Go Global.
Lead-Based Paint Disclosure was a regulation enacted after studies showed that lead-based paint was possibly the primary source of lead poisoning for children. This also affecting fetal tissue, causing irreversible brain damage and impaired mental functioning. How many children and parents needlessly suffered prior to this disclosure law? To get more lead-based paint facts and its affect click here.
Agency disclosures details who the agent works for in the transaction along with the duties of the licensee to the client. There are many instances when one agent can work on and for both sides of the transaction, thus creating a dual agency. 
Real Estate Transfer Disclosure Statement covers the gamut of disclosures. It can be material facts about a house or neighborhood that a seller would know, possibly affecting the home’s current or resell value or desirability.
Stigmatized properties are fun stories to tell to other agents, but try selling one.
- Criminal stigma such as a drug house or brothel associated with the desired home. The last thing you want is for your client to be propositioned in her own front yard while watering her grass or stooped over geraniums.
- Public stigmas and nuisances – can you imagine buying a home next to the circus likes of Britney Spears and Lindsay Lohan? NO THANK YOU! The house used in the opening credits of the 1970′s show The Brady Bunch is still known to have spectators driving by.
- Phenomena stigmas can make it really hard for a seller. The home used in the movie The Amityville Horror had to go as far as to renovate
and change the address number due to rumors and hoaxes surrounding the home in order to keep sightseers from being a nuisance. - Murder/suicide stigmas Sharon Tate’s home is one of the most famous examples of this type of property stigmatization due to her murder by the Charles Manson followers. Nicole Brown’s home located in the high demand area of Brentwood, took a few years to sell immediately following her murder when it normally would have been snatched up in a few short months.
I’d have to say, one of the most memorable fictionalized examples of non-disclosure would have to be in the movie POLTERGEIST. In the film, the real estate developer pulled the old ”remove the headstones and build a tract of beautiful homes over a cemetary” trick. When the family started digging in the backyard to build a pool, all hell broke loose. I wonder if the Simi Valley,CA home used for the model now has a slight “Public Stigma?”
There are many real estate disclosures one must sort through when selling or buying real estate. Disclosures are not to be taken lightly on either side. It saves, time, money, LICENSES and possible other grave tragedies. Which side of the pain coin would you want to be on in light of failed disclosure? How about none?
