You need to know how to minimize post-closing risks as a seller because it’s a reality we live in a litigious society. Homebuyers who suffer from one or more forms of buyer’s remorse are likely to take legal action. Even in instances when there is no real substance (what’s known as “unmeritorious” in the legal community), a lawsuit will be a big annoyance and inconvenience at the very least. These lawsuits range from problems with home inspections to serious non-disclosures.
Types of After Closing Lawsuits
As a seller, you are taking on risk when you list your property for sale in a number of ways (though the number of lawsuits remains a very small percentage of all closed sales). An experienced and professional real estate broker or agent has heard their fair amount of horror stories. For instance, if you know there is unpermitted work in the house — even if you didn’t perform the work — you are required under Florida law to disclose it.
In sports, every athlete recognizes that to gain the winning edge, preparation and knowing the competition are key. Prospective purchasers should approach acquisitions with the same philosophy. Effective transaction management begins with understanding how environmental obligations arise and then identifying such potential obligations through the due diligence process. The prospective purchaser also needs to be cognizant of the seller’s goals and objectives. —Find Law.com
Another scenario is selling a lakeside home and marketing it as having 100 feet of waterfront but it actually has 80 feet of waterfront. While this seems to be a nitpicking discrepancy, if you put the ostensible buyer’s shoes on, your perspective would differ greatly. The fact of the matter is, while post-closing lawsuits are do not rise anywhere near the level of being commonplace, these legal actions to occur from time-to-time.
How to Minimize Post-Closing Risks
Although it’s tough to accept, it’s easy to understand why after closing lawsuits are filed. For instance, a buyer could learn something about a neighborhood after living there for several days or weeks and want to use a convenient escape hatch. To provide yourself with peace-of-mind as a seller, you should know how to minimize post-closing risks so you don’t find yourself entangled in a real mess:
- Be honest with numbers. Every number included in the listing description and purchase contract must be accurate. If a home has 2,294 square feet of livable space, do not round-up. Worse yet, do not classify rooms or spaces as something other than they actually are. For instance, calling a den a bedroom is a no-no, particularly if it doesn’t have a closet and a door.
- Disclose all the issues known to you. No matter what you know about the house, it’s better to disclose rather than stay silent. By omitting key facts, you are perpetrating a fraud — regardless of how minor the issue is. Disclose freely so you do not open yourself up to a potential lawsuit — it will not be worth the time, frustration, or cost.
- Don’t embellish your house’s qualities. If the home is near or even on the border of a particular highly desired neighborhood, do not describe it as being in that particular neighborhood. The legal description won’t support your assertion and it’s wrong to misrepresent a property’s qualities.
- Do not make promises you cannot keep. When you negotiate the sale of your home, you might well be asked to concede to repair this or that. If you agree, you are entering into a legal obligation and if you do not have the means to keep a promise, just don’t make it.
- Never attempt to hide defects from buyers. Much worse than omitting disclosures is to actively try to conceal defects. If the home inspection doesn’t uncover the ruse, the buyers and future residents will probably uncover it and that’s going to be nothing but trouble.
If you are considering buying or selling a home in Orlando’s Hunter’s Creek, or another community, contact us for the latest market information. We will help you find the right property.