Just the Facts, Ma’am.
P
URCHASING a home can be very stressful. A buyer’s two greatest fears are missing out on important informa-tion
and losing money. Both can happen when a buyer goes into a sales transaction blindly, with false impres-sions
on how a home purchase can transpire and how the parties to the contract interact with each other.
Most buyers’ fears come from unknowns and red flags such as property defects. These defects are some-times
found during a home inspection, but most are discovered during renovations and remodeling after a
home purchase, which can unfortunately leave the buyer little or no recourse in the situation.
Most buyers incorrectly believe sellers are required to tell prospective purchasers about any and all problems with the
home. But North Carolina is a caveat emptor state — meaning buyer beware. Most sellers are not licensed real estate agents
and are not bound by any laws, agency or state regulations to disclose
anything that is wrong or could potentially go wrong with the home.
Licensed real estate brokers, however, are bound by regulations and
laws, including the most important of all for buyers: the property disclo-sure
laws.
Real estate licensees are required by state statute to disclose material
facts to everyone in the transaction, and they may be subject to disci-plinarian
action for either misrepresenting facts or failing to disclose a
material fact.
State law requires licensed real estate brokers to discover and disclose
any and all potential, confirmed, and/or proposed imperfections, such
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as leaking roofs and flooding.
They also mandate the disclo-sure
of any external locational
influences such as flood zones,
future developments, or zon-ing
issues; the presence of
lead paint; that a house is cur-rently
or was previously clad in
synthetic stucco (EIFS) siding;
the property was used as a
“meth” house; gravesites on the
property; presence of a proba-ble
defect in the polybutylene
piping; a home’s unpermitted
additions and improvements;
radon gas present; inaccurate
square footage reporting; and
matters affecting a party’s
ability to perform, including
death or serious illness and
pending foreclosure.
These “dirty little secrets,”
which can and will affect a
home value and use, are called
material facts.
BY GABRIELA HUFFMAN
ILLUSTRATIONS BY WILL JONES
A material fact in a real estate transaction is really any fact that is important or relevant