Small change to the Seller’s Property Disclosure

On Friday, April 8, you will notice that your Seller’s Property Disclosure Statement (PAR Form SPD) looks a little different.

The first page of the document is now entirely information regarding the law and its exceptions and the purpose of the form. Previously, half of this material was found on the last page of the SPD called “SPD Notices,” with the other half on the first page. Keeping in line with the recent trend of removing back-end notice pages, this information has now been relocated in one location at the very beginning of the document. This made more room for four additional questions on the contact information for a homeowners’ association, if applicable.

ZipForm® subscribers have something else to look forward to, which is the addition of an e-signature version of the SPD, which will be available soon (but not on April 8). This version will allow sellers to fill in and electronically sign the form without having to print it.

A change to the SPD is as good a time as any to review the intricacies of the law and how to fill out the form. The SPD – and the law behind it – is likely one of the most misunderstood forms in our library. Keep in mind that exceptions to disclosure are extremely limited and even if you believe that your seller falls under one of those exceptions, it is usually best to err on the side of disclosure. Although full disclosure might scare away some potential buyers, it is also remarkably good at fending off potential lawsuits.

Remember that the SPD is not a substitute for the Lead-Based Paint Disclosure. There are five requirements which must be met in order to comply with the EPA’s regulations and simply providing a Seller’s Property Disclosure Statement does not meet those requirements. Lastly, you should be aware that liability can attach to you as the agent, just as it can to the seller. In fact, “any person who willfully or negligently violates or fails to perform any duty prescribed by any provision of [the Real Estate Seller Disclosure Law]” can be liable to the buyer. Licensees can also find themselves in violation of the regulations of the State Real Estate Commission for failure to properly advise their clients about the duty to disclose and for neglecting to ensure delivery of a Seller’s Property Disclosure Statement.