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Understanding the Property Disclosure Statement - YouTube
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the property disclosure statement
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is one of the forms commonly used in
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real estate transactions in bc
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this form is where sellers disclose
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facts about the condition of the
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property
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so that buyers can make an informed
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decision when considering purchasing the
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property
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in bc there are different types of
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property disclosure statements that are
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used
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depending on the type of property being
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sold
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two common examples are the property
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disclosure statement for residential
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properties
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and the property disclosure statement
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for rural properties
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while each of these documents covers
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similar kinds of disclosures
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the different versions of the property
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disclosure statement contain
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different questions depending on the
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property type the questions are
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typically asked based on the current
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condition of the property
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here are two examples of questions you
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will see are you aware of any additions
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or alterations made without a required
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permit and final inspection
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for example building electrical gas etc
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and are you aware of any moisture and or
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water problems in the walls
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basement or crawl space so how does it
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work
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the seller completes the property
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disclosure statement specific to the
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property type
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by reviewing each of the questions and
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initially in the appropriate box to
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complete their response
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all representations should be made with
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care so that they're not
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false or misleading sellers with limited
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knowledge about the property may choose
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to strike through or not
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complete the form this might happen if
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the property is occupied by a tenant
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or if the seller is listing the property
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as executor of an estate
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or as power of attorney for the owner
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even if a seller chooses not to complete
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the form
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if the seller is aware of a latent
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defect it must be disclosed to a buyer
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a latent defect is a defect that is not
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discoverable by a reasonable inspection
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or inquiry and makes the property unsafe
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or unfit for human habitation it must be
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disclosed to a buyer
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realtors have a duty to disclose a
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material latent
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defect as defined under the real estate
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services act
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while a latent defect is any defect that
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is not discoverable by a reasonable
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inspection or inquiry
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and that makes the property unsafe or
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unfit for human habitation
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a material latent defect as defined
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under the act is broader
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if a known material latent defect hasn't
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already been disclosed by the seller
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realtors must disclose this to their
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clients and all other parties in the
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transaction
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prior to the seller accepting an offer
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so what happens if issues are identified
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in the property disclosure statement
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in this case a buyer should consider
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doing additional due diligence to ensure
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they're making an informed purchasing
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decision
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while the property disclosure statement
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is not a mandatory form
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by completing it the seller may minimize
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the risk for potential claims
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after the sale of their property buyers
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may expect sellers to complete the
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property disclosure statement
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to help them understand the current
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condition of the home as
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known by the sellers based on this
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information a buyer might decide whether
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they wish to make an offer on the home
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based on the known current condition and
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what additional due diligence they may
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want to consider
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what happens if new information becomes
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available during the listing or sale of
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a property
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for example what if it turns out that
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renovations were done without a permit
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the home needs a new roof or there is a
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mold infestation
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it's best practice for the seller to
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amend the property disclosure statement
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to reflect their current knowledge of
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the property
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this helps the seller avoid making a
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misrepresentation if the property
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disclosure statement
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is incorporated into the contract of
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purchase and sale
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if new information becomes available
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after an offer is accepted
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the seller should seek legal advice to
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help them determine their disclosure
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requirements
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at the end of the day it's in the best
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interest of a buyer to ensure the
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property disclosure statement is
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completed
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reviewed and incorporated into an offer
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it's also important to know
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that the property disclosure statement
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reminds buyers of the importance of
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making their own inspections and
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inquiries
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since a seller's recollection or
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knowledge of their own property
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might be incomplete when a seller is
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unsure whether aspects of the building
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or property need to be disclosed
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they should seek independent legal
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advice if you have any questions about
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the property disclosure statements or
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other forms used in real estate
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transactions in bc
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ask your realtor realtors are here to
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help
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