When a transaction is an AS-IS sale, the seller often insists that the property is in “AS-IS” condition in an attempt to reduce repair limits/credits and possibly shift the responsibility for determining the true condition of the property to the buyer. It is well known that the buyer is typically given a specified period of time to inspect the property and, if not satisfied, cancel the transaction and walk.
However, a seller is not protected from failing to disclose any known material defects in an AS-IS sale. Thus, an AS-IS sale does not mean that the seller can withhold known damage from the buyer. A seller is required by Florida law to disclose all known defects that could materially affect the value of the property. A seller who withholds such information could be held liable for his actions regardless of whether the transaction is conducted AS-IS.
As a proactive measure, we recommend Realtors use the FAR Seller’s Property Disclosure Statement to educate sellers on their legal obligations to disclose to the buyer all known facts that materially affect the value of the property that are not readily observable. The use of the FAR Seller’s Property Disclosure Statement facilitates the development and implementation of efficient and effective listing and disclosure processes.
The greatest benefit of the FAR Seller’s Property Disclosure Statement to the seller is that it provides documentation of his or her disclosure of material defects, thereby limiting potential future litigation. Additionally, the FAR Seller’s Property Disclosure Statement generally results in the buyer being more satisfied with their purchase and less likely to encounter surprises about the property’s condition.
As always, should you have any questions regarding any of the foregoing, please do not hesitate to contact a member of the Berlin Patten team.
This communication is not intended to establish an attorney client relationship, and to the extent anything contained herein could be construed as legal advice or guidance, you are strongly encouraged to consult with your own attorney before relying upon any information contained herein.
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