Disclosure — What Agents Must Reveal

Disclosure requirements protect buyers from hidden defects and protect agents from liability.

Material fact: Any fact that would affect a reasonable person's decision to buy or the price they would pay. Must always be disclosed.

Federal mandatory disclosures:

Lead-based paint (pre-1978 homes)

Agency relationship (who the agent represents)

RESPA/TRID closing cost estimates

Seller disclosure: Most states require sellers to complete a written disclosure statement revealing known defects: roof leaks, foundation issues, pest infestations, water damage, HVAC problems, etc.

Stigmatized property: Property associated with past events (murder, suicide, haunting, crime). Disclosure requirements vary widely by state. Many states do NOT require disclosure of death on property.

Latent defect: Hidden defect not visible during normal inspection. Seller must disclose known latent defects.

Patent defect: Visible defect that buyer should notice during inspection. Seller generally not required to point it out.

Caveat emptor ("buyer beware") is largely replaced by mandatory disclosure laws.

Reference:

Wikipedia: Seller Disclosure

https://en.wikipedia.org/wiki/Seller_disclosure_statement