Sellers Disclosure

The Minnesota Association of REALTORS® has an "approved" Seller's Property Disclosure Statement" which we use for our St. Paul listings.  I had somewhere figured that the form is required by Minnesota statute when what is really required is disclosure.  There's even a little clause under the MAR dislosure form title which "disclaims any liability arising out of use or misuse of this form." 

Without the form, however, how would the seller know what to disclose and what not to disclose?  For instance, it is not required for the seller to disclose if a predatory offender lives nearby, but it is required to give the information to the buyers which allows them to research the presence of predatory offenders.  As a result the MAR form has a paragraph with the Minnesota Department of Corrections website and phone number.  How would an unrepresented seller (one not using a real estate agent) know they were required by law to give that information?

The list of things the seller does NOT have to disclose includes:

• occupancy of the property by anyone with AIDS or HIV
• suicide, accidental death, or natural death in the home
• "perceived paranormal activity" which means ghosts or other presences
• the presence in the neighborhood of an adult family home, community based residential facility or nursing home
• the presence of a predatory offender in the neighborhood

Since this list is specifically addressed by the Minnesota legislature, it's clear there is no duty to disclose.  However, the statute says that sellers "are obligated to disclose all material facts of which the seller is aware that could adversely and significantly affect an ordinary Buyer's use or enjoyment of the property".  The list of things above is specifically excluded.  However, there are many buyers that do not want to buy a house where someone died an unnatural death.  Even though there is no DUTY to disclose, be assured your neighbors will inform the new owners of all the gory details.  Whether the courts would support withholding of such information is still to be determined. 

In the meantime, my motto is the more you disclose, the better.  If someone met an untimely death, the disclosure could be as simple as this:  "A personal tragedy occurred in this home.  Serious buyers should have their agent inquire about the details."  With a statement like that, privacy can be maintained without failing to alert the buyers to the gorilla in the room!

Comments

[Sarah Mascara]

Great article and fun to read. It's my understanding, if you're representing a buyer who has disclosed to you that they cannot live at a property where there is perceived paranormal occurrences or there has been a tragic accidental death/suicide, it's your duty as buyer's agent to do your due diligence by asking the listing party about those facts, which are material and important to your buyer. Our brokerage actually called the board about this recently and that was the boards assessment as well.

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[Bonnie Erickson]

Michele, Your comments are exactly why I pursue the information my clients want about the house. I would never scoff or laugh off my clients needs in a home. I truly respect the cultural diversity and try my hardest to obtain the info my clients need. I've had myriad examples of clients needing houses that faced a specific direction, did not have front and back doors in line, etc. Whether it is my belief or not does not discount that it is important to my client. It is my fiduciary duty to place my clients' interests above my own. This includes their spiritual needs.

[Michele]

As a buyer and practitioner of Feng Shui I would like to know if in the last 25 years there was a death or illness in the home I plan to live.

It reminds me of the conversation I had with our realtor before we bought our current home 15 years ago...some years back a prominent builder was shot and killed by his teenage son. It was in the neighborhood we planned to buy into. My Realtor laughed and said no that didn't happen in your neighborhood. However a few years later one old time neighbor moved back into the community; over coffee she disclosed the history of the home, the abuse the boy suffered and what drove him. Turns out it is the house across the street. Homes carry energy and well I want to know the history of the place I plan to buy.

[Bonnie Erickson]

Greg,

I am not bending the law. More disclosure is never a problem nor can it be construed as bending the law.

I also am not putting my personal beliefs into my opinion. My personal beliefs are that I don't care what happened in the house. If I like the house, I will buy it and live in it. I also do not get an inspection or care about the seller's disclosure. My level of expertise as a rehabber prepares me for what might need to be repaired in a house more than my clients who may, or may not, have owned a home before.

My experience as an agent who respects her buyer client's beliefs and tries to meet and protect their best interests is another thing entirely. There are spiritual beliefs that disallow a person moving into a house where a death has occurred without first cleansing the house. Some who believe in ghosts want to live with them present and some consider them evil and would not buy a house that was haunted. Am I to NOT pursue the relevant information for those clients?

I have had other clients who walked away from an estate house because the listing agent would not reveal whether the seller died from unnatural causes, i.e., murder, drug overdose (which is not excluded from disclosure). My clients would have purchased the house if the former owner died from AIDS, HIV, or old age. It was the bad vibes of crime that concerned them.

[Greg Broadbent]

I don’t think I agree with you at all. You are putting your personal beliefs into the situation. The fact that someone died in the property does not change the property at all. It is still the same size, shape and condition. People who don’t believe in the afterlife or ghosts shouldn’t care about a death in the home. In Mystic CT, there are houses that are hundreds of years old. Should I tell them about the many original family members that probably died in the home? What you are actually doing is compounding the tragedy the family has had. First a death and now a huge loss in value to the home.

They made the law for a reason if you start bending one why not bend others? Tell your clients upfront and be honest with them before you start showing them houses. Tell them where they can find out information like that so that when they find the house they like, THEY can choose what non material facts will effect their decision.