About that Seller's Disclosure

In Michigan all sellers of real property are required to furnish a completely filled in "Seller's Disclosure" statement. The state legislature outlined exactly what the contents are supposed to be and the form has been updated several times since its unveiling. Keep in mind that this document is a disclosure, not a warranty. The seller MUST furnish a disclosure to the buyer or the buyer may terminate an otherwise binding contract.

There are four parts to the disclosure:

1) Appliances/Systems/Services

2) Property Conditions, Improvements & Additional Information

3) Other Items

4) Ownership information and state equalized value.

Within all 4 parts the seller is required to disclose what he/she knows about the condition of the items listed and if a negative condition exists to explain what he knows about the item.

As a buyer the Seller's Disclosure is usually the 2nd step in your process of determining the condition of homes you may be interested in investing in. The first step is, of course, your own walk-thru of the property to determine if you would like to own it. Then you get the seller's disclosure and compare what you saw to what the seller wrote in the disclosure. If everything is in order and you successfully negotiate a purchase contract the 3rd step is to have the home professionally inspected. The cost in Michigan runs generally from $200 to $400 depending on the size of the home and the type of report you would like the inspector to give you. I estimate that 95% of all sales in my area are contingent on a satisfactory home inspection. Remember, though, that unless you buy a new build job you are buying a USED STRUCTURE IN AS IS CONDITION. That's why the first step, your own walk-thru before you write a purchase contract, is very important. You should satisfy yourself that the property is in a condition you can live with and negotiate accordingly.