New disclosure regulations and a new version of the Seller’s Real Property Disclosure form (SRPD) became effective in Nevada on October 1st. The SRPD form used in most residential real estate transactions has several noteworthy changes. The first is on page one of the four page form where the option of a Seller declaring exemption per terms of NRS113.130(2) has been removed. In its place are options to declare the type of Seller, i.e.- Bank (Financial Institution), Asset Management Company, Owner-Occupier, or Other and a blank to fill in.
Also added on page one is the following statement, “Systems and appliances addressed on this form by the seller are not part of the contractual agreement as to the inclusion of any system or appliance as part of the binding agreement.” Yes, it sounds confusing to us as well. If an item like a hot tub isn’t included it would seem logical to mark the N/A option, Not Applicable. If you are including the item then it is part of the agreement regardless of what this
new clause is trying to say.
Another new disclosure clause is pretty self-explanatory, “Has property been the site of a crime involving the previous manufacture of Methamphetamine where the substances have not been removed from or re-mediated on the Property by a certified entity or has not been deemed safe for habitation by the Board of Health?” This information can be vital to a Buyer’s decision making process, from price offered to rescission options.
The last SRPD detail change is the addition of a question asking if the property is subject to a Private Transfer Fee Obligation. A Private Transfer Fee Obligation is as an obligation created by a declaration, covenant, or any contractual agreement or promise, whether or not recorded, that requires the payment of a private transfer fee to the declarant, or other specified person, or to his or her successors or assigns, upon a subsequent transfer of an interest in the real property. The most recent Nevada Legislature deemed that Transfer Fee obligations violate the State of Nevada public policy by impairing the marketability and transferability of real property and by constituting an unreasonable restraint on the alienation of real property. Good to know if you have one.
Two important legal changes appear in the law portion of the SRPD. The first says that a purchaser of residential property may not waive their disclosure rights and a seller may not require a purchaser to waive any of their rights. This had become a prevalent practice with so bank owned properties and is no longer allowed.
The second change addresses property sold by foreclosure. Now, in addition to existing disclosure requirements for any defects known to the Trustee and beneficiary of the deed of trust, they must now provide the contact information of any asset management company who provided asset management services for defect repair or replacement whether or not the efforts were done to completion.
Our Advice: Sellers - always, always, always…“when in doubt disclose”. Buyers, be sure to read the SRPD. There are legal rights available to you if the Seller doesn’t provide a disclosure, or is fraudulent with what they do or don’t disclose. Penalties can be up to three times damages you incur. Don’t simply rely on a Seller’s disclosure efforts.
Buyers and Sellers have a responsibility to disclose and investigate the property that is the subject of their transaction. Do your part.
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Lisa Wetzel and Jim Valentine are the authors of this blog. Lisa, Jim and Jessie are experts in Carson Valley , Carson City and the tri-county area of Douglas County, Carson City and Lyon County. Call our team anytime at 775-781-5472 or 775-781-3704. To Search for Homes go to: Carson Valley Listing Book or visit our website at www.CarsonValleyLand.com