What Are the Disclosure Requirements in a Wisconsin Home Sale?

 Posted on March 03, 2021 in Real Estate

The purchase of a home is a complex process that has a significant impact on both the buyer and the seller. As such, a successful purchase requires a certain level of transparency and trust between the two parties. When a buyer or seller does not act in good faith or fails to fulfill an obligation, major obstacles to the sale can arise, not to mention legal issues that often must be resolved through real estate litigation. One such issue that Wisconsin home buyers and sellers should be aware of is the seller’s failure to make required disclosures about the property.

What Does a Seller Need to Disclose?

In Wisconsin, once a buyer and seller agree to a purchase contract for a residential real estate property, the seller is usually required to complete a Real Estate Condition Report and provide it to the buyer within 10 days. In the report, the seller must disclose any known defects in or on the property that would have a significantly adverse impact on its value, expected lifespan, or the health and safety of its occupants. The disclosure form includes questions regarding defects in a variety of categories, including but not limited to:

• Defects in the roof, foundation, structure, electrical or plumbing systems, and mechanical equipment
• Environmental defects, including the presence of mold, radon, asbestos, other hazardous substances, or destructive pests
• Defects in a well, septic system, or fuel storage tank
• Land use issues, including easements, encumbrances, and zoning violations

When the seller indicates that there is a known defect in response to any of the questions on the form, they are required to provide an explanation of what the defect entails.

Obstacles and Legal Issues Involving Disclosures

Issues related to disclosures and defects may sometimes derail the sale of a home. For example, a buyer is permitted to back out of the purchase contract if the seller fails to provide the disclosure report within 10 days of the agreement, or if the report reveals a defect that the buyer is uncomfortable with. Additionally, if a home inspection reveals defects that were unknown to the seller, the buyer may rescind their agreement if they are unable to negotiate with the seller for a repair or credit.

The situation can become even more complicated if a buyer discovers undisclosed defects in the home after the sale is complete. A buyer can file a lawsuit against a seller for misrepresentation, fraud and breach of contract related to a failure to disclose, and they can pursue damages for losses related to the defects. Sellers may need to prepare to defend against allegations that they intentionally misled the buyer or withheld information about defects.

Contact a Milwaukee Real Estate Litigation Attorney

In order to avoid errors that can lead to future legal conflicts, both buyers and sellers should consider hiring an attorney to represent them during the home closing process. Buyers and sellers facing litigation as a result of a sale should contact an attorney right away. At Gimbel, Reilly, Guerin & Brown, LLP, we can provide the legal advice you need as you buy or sell your home, and we can also work to protect your rights and interests in a legal dispute involving the property. Contact a Milwaukee County real estate litigation lawyer today at 414-271-1440.

Sources:

https://docs.legis.wisconsin.gov/statutes/statutes/709