There's an adage that one man's trash is another man's treasure. One of the most obvious cases of this might just be the fixer-upper home. The seller has decided they have had enough, prices the property accordingly and the astute seller grabs the deal, knowing there will be construction or improvements involved--and willing to take on the challenge! After all, for some folks, the journey is the best part of the destination.
These transactions used to be "as-is" meaning that the seller was making no representations on the conditions of the house beyond what was patently obvious: It was cosmetically challenged. Any issues with the constitution of the property--think sagging or cracked foundation, corroded pipes, or nesting attic raccoons--was a finders-keepers proposition: You find them, and you, the buyer, keep them.
Enter the Transfer Disclosure Statement
These houses used to be a more or less simple real estate transaction. Until, that is, the state of California mandated the Transfer Disclosure Statement. Any real estate professional has dealt with these numerous times, and you may even be aware these statements can, in fact, be waived by both the seller and the buyer. This sounds like the old days when a sales transaction could be as little as a page long, and as succinct as the oft quoted Rodney Dangerfield: Take my house--please! But is waiving goodbye so quickly a prudent--or risky--endeavor?
Not so fast!
While it might seem the logical--and logistical--thing to do, take a moment to consider this: A California real estate purchase followed this scenario exactly and the transaction made itself all the way to the Court of Appeals.
What started as a seemingly cut and dried "as-is" sale cost tens of thousands of dollars to litigate, only to have the Courts determine that while you can waive the disclosure statement, you can't waive your responsibility to disclose. Confused? Of course. Concerned? You should be! Check out this video to find out how to ensure that both you and your client can avoid getting caught in a legal "title-waive"!