Just before you finish the escrow process and before your home is officially sold, you'll need to fill out a form called the seller's disclosure. The seller's disclosure lists any information that you have about the property and includes questions regarding the state of the property, such as whether or not it has ever been flooded or whether it presently contains asbestos.
Here are three things you should know about the disclosure to get it done quickly and correctly.
1. Your Real Estate Agent or Realtor Cannot Help You
This deserves some clarification. They can explain the form and what it means, but they cannot tell you what to put down—even if you ask them for advice. This is for liability reasons. You are expected to go over the form and fill it out on your own. The seller's disclosure needs to be entirely honest, which is why giving advice or information can be seen as detrimental.
2. You Can't Use "NTMK" to Avoid Answering a Question
When you fill out your disclosure, you will often need to select "yes," "no," or "NTMK." NTMK stands for "Not to My Knowledge." You can only select this if the information is truly not to your knowledge. For instance, if you think you have asbestos, but have never gotten it tested, you may place your mark under NTMK and then clarify that you aren't certain. However, if you were previously told that you do have asbestos, but didn't test it yourself, you cannot select NTMK to avoid saying "yes."
3. You Need to be as Specific as Possible
The seller's disclosure is designed to protect you against liability. Too often, sellers avoid adding information that might cause the buyer to back out last minute, but this will cause problems later on. If your house flooded a year ago, for instance, and you don't tell the buyer—and the buyer later finds undiscovered mold—you can be the target of a lawsuit. However, if you had already disclosed the flooding on the seller's disclosure, the buyer would not be likely to win such a lawsuit; they would have already been warned that this could be a possibility.
If you're concerned about accidentally omitting information from the seller's disclosure or filling it out improperly, you may want to communicate with a professional in real estate law through resources like Schulze Howard & Cox. As your real estate professional cannot help you with the seller's disclosure, it's often better to consult legal aide.