Property Condition and Buyer Beware
Property Condition and Buyer Beware
Caveat emptor is a Latin phrase that means “let the buyer beware”
Traditionally, it has been the buyer’s responsibility to learn about and discover the true condition of the property before purchasing it. In the current real estate market, caveat emptor (Buyer Beware) is practiced in theory except for a Maryland law which requires sellers to disclose “material latent defects” and condition of the property to potential buyers. “Material latent defects” are defined as defects that a) are known by the seller; b) can’t be discovered by the buyer upon a close inspection of the property and c) pose a direct impact to the life, safety and health of occupants of the property. A defect must pass as a “material latent defect” in order for the seller to be bound by legal duty to disclose it to the potential buyer, in which the spirit of case caveat emptor still stands.
For defects that are not considered “material latent defects”, the seller must voluntarily disclose that information or let the buyer know that the property will be sold “as-is”, meaning there is no implied warranty or representations of the property. This is done on a Disclosure/Disclaimer form(s) provided to the buyer prior to the contract of purchase. However, even if the property is “as-is”, a serious potential buyer can request in your offer to do a home inspection and leave in the right to opt out if a substantial amount of repairs are needed. Though the seller may not be willing to fix any problems, they may offer a seller credit or even a price reduction by as much as $5K to $10K. Additionally, “as-is” tends to scare off many buyers so the property will potentially have less competition when making an offer which lowers the purchase price. scares away so many buyers, it will potentially have less competition when making an offer, and thus a lower purchase price. The Buyer’s Agent can assist the buyer through the home inspection process as well as appointing qualified professionals to conduct thorough inspections.
Keep reading to learn more and familiarize yourself with the basics as I cover some of the most important aspects of the real estate process. Feel free to call or message me with any and all of your real estate questions! I am always here to help.
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