I am the listing agent for family-owned property. The current owners of the property are sisters who recently inherited the property from their deceased parents. The sisters never lived in the property but believe the property might have some termite damage and foundation issues. The sisters do not want to complete a property disclosure form because they believe it will hurt their ability to sell the house.
Do the sisters have to complete a property disclosure form?
Also, I live near the house and over the years I have seen various trucks at the house for Foundation Companies and Pest Control Companies. Do I have to disclose this information to any potential buyers?
Believe it or not, this scenario happens more often than you would think.
According to paragraph seven (7) of the “Informational Statement for Louisiana Residential Property Disclosure” promulgated by the LREC, the sisters do not have to complete a property disclosure form since the property they are selling was inherited by them pursuant to their parents’ Successions and since they never lived in the house.
So, at first glance the sisters might think they are off the hook based on a technicality!!
However, the fact that the sisters don’t have to complete a property disclosure form does not relieve the sisters from disclosing what they know about the possible termite damage and foundation issues!
Please look near the top of the “Informational Statement for Louisiana Residential Property Disclosure” where it asks “WHO IS REQUIRED TO MAKE DISCLOSURE?”
The first sentence after that question states (in bold, I might add),
“ALL SELLERS are required to make written disclosure of known defects regarding a property being transferred.”
So, even though the sisters don’t have to complete the property disclosure form, the sisters still have a duty to disclose the defects known to them.
Now, on to your second question…..
The sisters have disclosed to you there might be possible termite damage and foundation issues. Couple this knowledge with the fact that you’ve seen Pest Control and Foundation Repair trucks at the house, I think it’s safe to say that you have knowledge of possible defects concerning the property.
Since you, as the listing agent, have knowledge of possible termite damage and foundation issues, Louisiana law is quite clear that you, likewise, must also disclose these defects to any potential buyers.