All sellers want to present their home in the best possible light. But in many states, including Ohio, you’re obligated to fill out a residential property disclosure form that requires you to reveal significant defects—even if you’ve done the repair. Choosing to hide known defects in your house can result in serious financial consequences if you’re caught.
Defects You Must Disclose
Issues with a system or component of your property that poses a risk or has a significant adverse effect on the value of the property is called a material defect. Chipped paint and scratches in the walls aren’t significant defects. On the other hand, if a puddle of water seeps into the basement when it rains, that’s something to disclose. Ohio’s property disclosure form contains a list of items that focus on
▪ plumbing and sewage issues;
▪ water intrusion of any kind (in basement, through ceiling or windows, etc.);
▪ heating or air conditioning issues;
▪ foundation issues;
▪ structural defects, including shifting and major cracks;
▪ roof damage;
▪ property drainage problems;
▪ presence of mold, termites, or other pest infestation;
▪ presence of lead paint;
▪ presence of above average levels of radon gas;
▪ problems with legal title to the property; and
▪ boundary issues with a neighboring property.
Ohio requires you to fill out the form with regard to ongoing issues and ones that have occurred in the past five years. When in doubt, it’s better to disclose than risk having an issue come back to haunt you in the form of a lawsuit. Even significant repairs should be disclosed. This shows buyers that you addressed a problem rather than neglected it. You aren’t providing a guarantee or warranty with regard to your repair, you’re simply giving notification. And disclosing a defect does not require you to repair it.
Consequences of Left-Out or False Information
While certain disclosures may become points of negotiation on the price of your home, it’s better to be in a position of negotiation than get sued later for being untruthful. There are a number of ways buyers can discover lies about your home, so don’t rely on outwitting anyone. Consequences for leaving out or lying about information could result in a court ordering you to pay for repair of the undisclosed defect, fining punitive damages, or in extreme cases, making you return the payment for the house and having the house put back in your name.
Disclosure for Inherited Property
An owner who has never lived in his or her inherited property is not required to fill out a property disclosure form. However, if such an owner is aware of a material defect, even if they’ve never lived in the home being sold, they are legally required to disclose that information. Owning inherited property does not relieve you of obligation to disclose known defects.
Be Truthful and Accurate
When you fill out the property disclosure form, give honest and accurate responses. Don’t ask your real estate agent to help you on this particular form. Your agent can provide the property disclosure form to you, but he or she hasn’t lived in the property and is not licensed to act as a legal expert. If you have serious concerns about what you must disclose, it’s better to consult a real estate attorney. It’s not only a point of legality to disclose your home’s significant defects, it’s also ethical and the most financially safe decision to make for the long run.