Effective today (10/1/2011) Senate Bill 314 goes into effect. This revokes the buyer’s ability to waive their right to get a Seller’s Real Property Disclosure (SRPD) form from the seller. The effectively forces a bank/REO/foreclosure/almost any seller to providing the buyer with this important disclosure form. The SRPD is filled out by the seller to indicate what systems in the house may need repairs that they are aware of as well as other things that may affect the value/usability of the property.
In practice, a buyer could expect to see an SRPD that may be less than helpful. For example, the bank may just write across the form in big letters, “Nothing wrong that we know of.” HOWEVER, if there is something they know about and didn’t disclose it, the buyer now has more ammunition to go after the seller should the defect be discovered after the sale. By the way, banks usually do have some knowledge of things that could need repair. This is because either a “BPO” (kind of a mini-appraisal done by a real estate agent) was done where the agent usually notes what obvious repairs need to be done or the listing agent noted the same when they came up with a suggested listing price.