Seller disclosures sound simple: if you know something is wrong with the property, disclose it. But real-world situations aren't always that black and white.
I've dealt with two situations in my career that illustrate an important distinction between knowing about a defect and simply knowing that routine maintenance has occurred.
A Drainage Dispute Early in My Career
Early in my career, a buyer experienced water in a garage after closing. My seller had never experienced the problem himself, but when he suggested that the buyer check whether leaves were covering a driveway drain, that innocent advice was later used as evidence that he must have known about a drainage problem.
Looking back, I was a much less experienced agent and didn't do as good of a job as I should have articulating that distinction and defending my client. He ultimately wrote a check to resolve the dispute.
A Rental Sewer Backup, More Recently
More recently, I encountered a similar situation involving a rental property. Months after closing, a tenant experienced a sewer backup. Historical maintenance records showed that plumbers had cleared drains twice over several years. Neither plumber identified an underlying defect or recommended additional repairs, and the repairs were below the property manager's threshold for notifying the owner.
The existence of a maintenance record doesn't automatically mean a seller knew there was an underlying defect.
That's the bigger lesson.
Watch the full video: this week's episode covers the exact scenario that prompted this post. Watch on Facebook →
What a Disclosure Is — and Isn't
A seller should truthfully disclose everything they know about the condition of the property and answer the disclosure questions completely. But a seller's disclosure is not a warranty that nothing will ever break after closing, nor does it make the seller a plumber, engineer, builder, or home inspector.
Disclose what you know. Don't hide known problems. Then give the buyer the opportunity to perform their own inspections and due diligence.
And if a dispute comes up later, experience matters. Knowing the facts is important — but so is having someone who knows how to articulate them and isn't afraid to stand their ground.
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