Home Seller Tips August 3, 2021

Why Taking Care of Your Buyer is Good for You Too

How you leave your home matters more than you think…

 

In our extreme seller’s market, today’s home buyers are paying top dollar (or beyond) for their home purchase, and like many people paying a premium, they expect to get what they pay for. As a result, they have little tolerance for adverse surprises. This has led to a significant uptick in post-closing claims.

One piece of advice we recommend to home sellers is to take good care of their buyer to leave a positive impression that makes them feel great about being the next owner your home. Aside from being the right thing to do, parting on good terms is likely to mitigate what could otherwise create headaches after the sale.

Here are a few suggestions for making sure your next home sale doesn’t leave you reaching for antacid weeks, months, or years down the road.

 

Disclose, disclose, disclose

Complete transparency is the best insurance policy

Let’s say you’ve had a [rodent, water intrusion, drainage, settling, lack of permits, etc.] issue in the past that you think is now resolved or shouldn’t matter. If you decide to say nothing, and buyer later has the same issue or hears about its history from neighbors or vendors, they will often perceive you as dishonest and put everything related to their home purchase through that filter. A few minor issues can quickly escalate into costly and avoidable litigation.

Take the same scenario but instead fully disclose the issue and any resolution that has occurred in your seller disclosure form (often referred to as Form 17). Now you have given the buyer an opportunity to evaluate any potential future risk. By disclosing a condition, the seller shifts the burden of investigation to the buyer. By remaining silent, a seller risks the appearance of concealment and a lawsuit. Think of it this way: disclose an issue and if the buyer accepts it, you move forward with no worries; fail to disclose and you could be looking over your shoulder for years. It is usually better to be over-insured than not insured at all. When something comes up after closing, buyer will be able to look back to your seller disclosure and see that you clearly disclosed the issue.

No house is perfect and when sellers claim there are no issues to explain, it sets off red flags for most buyers. Some sellers feel like disclosing every issue might make their home less valuable or attractive to buyers. In truth, you don’t want to sell to a buyer who would not have bought if they’d know the facts. It’s far better to find a buyer who is okay with existing issues and proceeds with a knowledgeable purchase than to live through months of emotional and financial drain resulting from post-closing claims.

Most buyers expect far more disclosure from the seller than the law requires. Sellers have a duty to disclose known defects or those that a prudent seller should have known. These can be related to physical condition or be things that affect the value or title. Sellers should consider disclosure to be a form of insurance. Instead of minimizing disclosures, a prudent seller will consider the property from the perspective of a buyer and then disclose what a buyer would want to know. Many of the conditions that lead to lawsuits would have been acceptable to the buyer if they had been disclosed in advance.

FORM 17 PROPERTY DISCLOSURE: Answer all questions accurately and include disclosure of anything the buyer may later perceive as an issue. Remember that by disclosing a condition, the seller shifts the burden of investigation to the buyer based on Washington court precedent. By remaining silent, a seller risks the appearance of concealment and a lawsuit.

SELLER PRE-INSPECTIONS: If you are providing a pre-inspection report to potential buyers, a more thorough report will offer your greater protection than a quick overview. If buyers can see overlooked items, they won’t trust the report, or you. While providing the report will likely protect you from most listed issues, if you have additional personal history with any issue, it should be detailed in your seller disclosure.

BIDS AND INVOICES: Frequently we hear stories about buyers seeking bids for a thought to be newly discovered issue only to hear from a vendor that they have been onsite before or even provided a bid. Savvy sellers will ensure that any issue they have received bids or invoices for is well documented in their disclosure and consider providing copies of recently obtained bids.

 

First impressions are lasting impressions

Leave the house the way you would want to find it

Sellers often ask how clean they need to leave a house or if they should repair the little dents and dings that often happen during a move out. Instead of think about the minimum requirement, consider thinking about how you would expect your home to be delivered if you were the buyer. Then think about the power of unexpected, pleasant surprises. Apartment managers, hotels, and merchandisers get this. Yet often in the hassle and craziness of our move out, we forget about the opportunity to create a great first impression that fosters good will down the road.

Your thoughtfulness doesn’t go unnoticed. Whether you need to pick up a package or mail that didn’t get forwarded, a family heirloom that was accidentally left in the attic, or otherwise connect with the buyer after the sale closes, having a positive relationship makes the process so much easier. We have found the best way to accomplish this is to plan ahead, before the moving chaos ensues, and engage pros where needed to ensure that you leave your home exactly the way you would want to find it.

MANUALS AND INSTRUCTIONS: Your home’s buyer will really appreciate having the manuals, notes and instructions that relate to how to operate the essential components of your home. It’s one of those things that is relatively easy for you assemble and invaluably resourceful for any buyer. Bonus points for sharing details about how to change codes, when garbage day is, and what’s planted in the yard.

KEYS, REMOTES AND ACCESSORIES: Our standard local purchase agreement requires delivery of all keys, remotes, and accessories on closing. If there are any locks that you do not have keys for, you should disclose that fact ahead of time or get them re-keyed for the buyer.

EXCLUDED ITEMS: If there is anything that appears attached or intended to be part of the real property and you wish to take with you, be sure to clarify this in your purchase agreement. Your broker can provide a complete list of items considered to convey with the property unless excluded. This avoids unhappy surprises and leaves everyone knowing what to expect.

Excluded Items Contract Snapshot

PROFESSIONAL-QUALITY CLEANING: While professional cleaning is not required by the purchase agreement, having your home professionally cleaned after moving out is a very considerate gesture. Hiring a pro to do this for you take the pressure off of you to come back and do a final cleaning yourself amongst the move out chaos.

ADDED TOUCHES: Some sellers take the time to write the buyer a personal note welcoming them to the home. This personal touch can often set the final tone for the transfer of your home and is well worth the effort.

 

Final thoughts

Taking care of your home’s buyer and leaving a good impression is priceless. So many times, it’s the little things that make all the difference. It not only makes you feel good, but it also makes them feel great about you and the home they’ve just spent sizable amount of money on. Like staging your home for sale to attract the highest and best offer, leaving your home in great condition, and with only happy surprises, will create the best possible post-closing experience for both you and the buyer.

Still have questions? Contact one of our knowledgeable brokers for assistance with selling your home.

 


 

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Home Buyer TipsHome Seller Tips May 11, 2020

What You Need to Know about the Washington State Seller Property Disclosure – Form 17

Washington State requires sellers of residential real property to thoroughly disclose material facts on a form called the Residential Real Property Disclosure Statement (often referred to as Form 17). Unless the buyer has expressly waived their rights, the seller must deliver this completed disclosure with 5 days after mutual acceptance.  The buyer then has a window of time to walk away with their earnest money at their discretion.

While sellers have always been required to disclose material facts, the Form 17 has been required by law (RCW 64.06.020) since January 1, 1995. It has undergone ten revisions since its inception, the last of which will go into effect in January. In addition to the residential disclosure, the state added an unimproved property (land) disclosure in 2007 (RCW 64.06.015) and a commercial property disclosure in 2012 (RCW 64.06.013). The current form is 6 pages long and includes most of the typical property issues requiring disclosure with a catchall question for anything left out.

 

Is every seller required to complete this form? Are there exemptions?

The statute allows very limited exceptions RCW (64.06.010) to completing the disclosure statement. They include transfers…

  • by foreclosure or deed-in-lieu of foreclosure
  • that are gifts to a parent, spouse, domestic partner, or child
  • related to marital dissolution or dissolution of a state registered domestic partnership
  • to buyers who had a prior ownership interest in the property in the last two years
  • of an interest that is less than fee simple
  • made by the personal representative of the estate or by a trustee in bankruptcy
  • in which the buyer has expressly waived the receipt of the seller disclosure statement

However, if the answer to any of the questions in the section entitled “Environmental” would be “yes,” the buyer may not waive the receipt of the “Environmental” section of the seller disclosure statement.

 

What happens after delivery of the disclosure statement?

The buyer has three business days from receipt of the disclosure statement to cancel the agreement for the purchase of the property (unless they waived their rights to do so in writing).

This right to rescind is statutory, and the decision to revoke the offer may be made by the buyer at the buyer’s sole discretion. If the buyer elects to rescind the agreement, the buyer must deliver written notice of rescission to the seller within the three-business-day period.

Upon delivery of the written rescission notice the buyer is entitled to immediate return of all earnest money deposits and the agreement for purchase becomes void.

If the buyer does not deliver notice the disclosure statement is deemed approved and accepted by the buyer. The full provisions of this right are found in RCW (64.06.030).

 

What happens if the seller doesn’t deliver a completed disclosure?

If the seller fails or refuses to provide a disclosure statement to buyer within 5 days, the prospective buyer’s right of rescission extends until the earlier of three business days after receipt of the disclosure statement or the date the transfer has closed (unless the buyer has otherwise waived the right of rescission in writing). After closing, per RCW 64.06.040 (3) the seller’s obligation to deliver the disclosure statement and the buyer’s rights and remedies related to it terminate.

 

Some sellers are more forthcoming than others…

When sellers claim there are no issues to explain, you should be wary…very wary. In 34 years of practice, I have yet to see a perfect house. Whether a 10-million-dollar estate, a newly constructed home, or a $300,000 starter home, every house has a story and every buyer has a right to know about it so they can knowledgeably complete their due diligence.

Making full disclosure actually benefits the seller, too. By disclosing a condition, the seller shifts the burden of investigation to the buyer under Washington law. By remaining silent, a seller risks the appearance of concealment and a lawsuit.  Think of it this way: disclose an issue and if the buyer accepts it you move forward with no worries since they are barred from seeking compensation later; fail to disclose it and you could be looking over your shoulder for years.

I like to see issues disclosed on a disclosure statement. It makes me feel like the seller has been honest and transparent. When I see a “perfect” disclosure, I know the seller is either in total denial or has decided not to disclosure the little (or big) issues they know about. Most buyers expect far more disclosure from the seller than the law requires. While sellers don’t have a duty to inspect their home or look for defects, they do have a duty to disclose defects that affect the value, physical condition, or title to the property. Sellers should consider disclosure to be a form of insurance.

Instead of minimizing disclosures, a prudent seller will try to consider the property from the perspective of a buyer and then disclose what a buyer would want to know. Many of the conditions that lead to lawsuits would have been acceptable to the buyer if they had been disclosed in advance. Other conditions simply are not important enough to the buyer to fully investigate before purchasing a property. To maximize the benefit of disclosure law, sellers may want to make full disclosure of the property and neighborhood even if they have no legal duty to do so. It is usually better to be over-insured than not insured at all.

 

Buyers have duties, too…

In addition to a thorough inspection, investigating issues raised in the seller disclosure statement is one of the most important parts of due diligence in a real estate transaction. Buyers have a duty of thoroughness and inspection that should not be taken lightly.

The buyer should evaluate each disclosed item, and (especially) those items not disclosed, but easily discovered during a walk-through and inspection. If there are many items identified and not disclosed, a buyer should be concerned about other unseen issues that might also not be disclosed. A savvy buyer will investigate a home with limited disclosure more thoroughly and/or make the decision not to purchase form a seller who is seemingly not transparent with the truth.

It is also important to note that sellers typically have no duty to disclose neighborhood conditions or past events at the property, even though these may be issues of concern to the buyer. For instance, sellers usually have no legal duty to disclose the following conditions either at the property or in the neighborhood:

  • Death, murders, suicides, rapes or other crimes
  • Ongoing criminal or gang activity in the neighborhood
  • Registered sex offenders in the neighborhood (RCW 64.06.021)
  • Future development in the area
  • Political or religious activities in the area

If these or similar matters are of concern, buyer should conduct their due diligence prior to submitting an offer or include an inspection and “Neighborhood Review” contingency in the offer to allow them time to complete it as part of their purchase agreement.

 

What is the seller’s responsibility after delivery of disclosure statement?

The disclosure statute (64.06.040) states that if after delivering a completed disclosure statement, the seller learns from a source other than the buyer or others acting on the buyer’s behalf such as an inspector of additional information or an adverse change which makes any of the disclosures made inaccurate, the seller shall amend the real property transfer disclosure statement, and deliver the amendment to the buyer. The buyer then has the right to rescind the purchase agreement within three business days after receiving the amended disclosure statement.

No amendment is required if the seller takes whatever corrective action is necessary so that the accuracy of the disclosure is restored, or the adverse change is corrected, at least three business days prior to the closing date.

 

The seller disclosure statement is not a warranty

RCW 64.06.050 says the seller shall not be liable for any error, inaccuracy, or omission in the disclosure statement if the seller had no actual knowledge of the error, inaccuracy, or omission. This includes disclosures based on information provided by public agencies, or by other persons providing information within the scope of their professional license or expertise, including, but not limited to, a report or opinion delivered by a land surveyor, title company, title insurance company, structural inspector, pest inspector, licensed engineer, or contractor. This applies to the seller’s real estate broker as well.

This should give a conscientious seller the assurance that the statute provides for property disclosure only and is not a warranty of current or ongoing condition. Provided a seller discloses everything they know, or that a reasonable seller should have known, about their property, a seller should feel good in knowing they are not held liable for its condition.

 

Here are a few great online resources to add to your knowledge base:

Current local Form 17 Real Property Transfer Disclosure Statement: https://windermeremicom/files/2019/08/17_SellerDisclosureForm.pdf

The complete text of the Washington State Real Property Transfer Act: https://app.leg.wa.gov/RCW/default.aspx?cite=64.06&full=true

NOLO Article: https://www.nolo.com/legal-encyclopedia/residential-home-sellers-washington-what-the-law-requires-you-disclose.html

 

Of course, nothing tops having an experienced pro to guide you through the process. They’ve seen hundreds upon hundreds of homes and can help you identify the solid finds from the duds with gorgeous looking veneer.

Choosing the right broker can save you thousands on your home purchase. Whether through local market knowledge and pricing analysis allowing you to make a smarter offer, recommendations and resources to thoroughly conduct your due diligence and avoid costly mistakes, or savvy contract negotiation to help you get the terms you need, having a Windermere broker on your side is an advantage you can’t afford to sacrifice.

 


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We earn the trust and loyalty of our brokers and clients by doing real estate exceptionally well. The leader in our market, we deliver client-focused service in an authentic, collaborative and transparent manner and with the unmatched knowledge and expertise that comes from decades of experience.

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