Property disclosures, inspections, and reports

Disclosure helps a buyer understand what is being purchased and on what terms. A material fact is information significant to value, desirability, or an informed decision. Repeated flooding, an unresolved roof leak, an unpermitted conversion, or a boundary dispute may matter even when no form asks the exact question. Completing checkboxes is not the entire duty.

An as-is agreement generally addresses condition and repair responsibility. It does not authorize fraud, concealment, or omission of known material facts. A seller may decline to repair a disclosed roof problem, while the buyer evaluates whether to proceed under the contract. The seller may not hide the same problem and claim that as-is language made it irrelevant.

Timing matters. Deliver required information early enough to support decisions, and update it when a material change occurs. A report received after acceptance can change the buyer's position even if the seller believes the problem is minor. Preserve the document and evidence of delivery rather than relying on a remembered telephone conversation.

The California TDS generally applies to covered transfers of residential property with one to four dwelling units, with statutory extensions and exemptions. The seller provides information about systems, conditions, alterations, neighborhood issues, and other specified matters based on the form and the seller's knowledge. The TDS is a disclosure, not a warranty that the property has no defects.

Exemptions include specified court-related and fiduciary transfers, certain foreclosure-related transfers, and some family or co-owner transfers. Each exemption must be established from the actual facts. Property being held in a trust does not automatically exempt every sale, and an investor seller is not exempt merely because the seller never occupied the house. A TDS exemption does not automatically remove other statutory disclosures or duties to disclose known material facts.

Seller and agent sections serve different functions. The agent should not complete the seller's knowledge answers as though they were the agent's own firsthand history. The agent completes the required inspection-related portion and discloses relevant observations. A buyer's signature acknowledging receipt ordinarily is not an agreement that every statement is true or a waiver of statutory rights.

For a conventional covered sale, deliver the TDS as soon as practicable before title transfer. If the required disclosure or a material amendment is delivered after execution of the offer, Civil Code section 1102.3 provides a termination opportunity: three days after personal delivery, five days after mailing, or five days after agreed electronic delivery. These are not automatically three business days in every situation. The statute also specifies when the required completed sections start the period. Distinguish this right from inspection contingencies and federal loan rescission.

The NHD identifies specified mapped hazards. Its six principal categories concern a FEMA special flood hazard area, potential flooding from dam failure, the specified high or very high fire hazard severity zones, a qualifying wildland fire area, an earthquake fault zone, and a seismic hazard zone involving landslide or liquefaction. Current fire language is broader than an old memory aid mentioning only very high fire zones.

A map-based statement does not guarantee that a property outside a mapped zone is safe or that a property inside a zone will suffer damage. Maps estimate hazards and can change. A report should identify the correct parcel and current applicable mapping. If an applicable map is too imprecise to determine inclusion, the statutory rule generally requires a yes response unless a qualifying report verifies that the property is outside the zone.

Qualified third-party reports can satisfy specified disclosure obligations under statutory conditions, including good faith and appropriate expertise. That does not permit ignoring a known error. An agent who sees that a report addresses the neighboring parcel must correct the mismatch rather than forwarding it as completed due diligence.

Hazard information can affect insurability, costs, construction, maintenance, and development rights. Additional wildfire disclosures, home-hardening information, and defensible-space documentation can apply depending on location, construction date, and current law. Do not assume that checking the NHD fire box completes every wildfire-related obligation.

Civil Code section 2079 requires a reasonably competent and diligent visual inspection in specified residential one-to-four-unit and manufactured-home sale transactions, followed by disclosure of material facts the inspection reveals. The statutory scope and agency relationship matter. Other fiduciary and common-law duties can impose obligations beyond the specific statutory rule.

Visual inspection is not a destructive investigation or a professional engineering analysis. Its statutory scope does not ordinarily require inspecting inaccessible areas or researching public records and permits. Those limits do not authorize ignoring visible warning signs or information already known. The correct response to a stain suggesting a leak is to disclose the observation and recommend appropriate investigation, not to diagnose the roof from across the room.

The buyer also has a duty to exercise reasonable care for personal protection. An agent should recommend suitable inspections and help the buyer understand deadlines. The buyer's responsibility does not excuse the seller or agent from making required disclosures. Responsibility is shared through different duties, rather than shifted entirely to whichever person signs last.

A general home inspection evaluates accessible systems and conditions within the inspector's scope. A structural pest report addresses wood-destroying pests and organisms and related conditions; a title report addresses interests and exceptions affecting title. A survey addresses boundaries and physical location. None replaces the others.

Specialist review may be appropriate for foundations, drainage, roofs, sewer lines, septic systems, wells, soil, environmental hazards, or electrical concerns. Verify an expert's qualifications and report limitations. Read the conclusions and recommendations, not just the summary page. A recommendation for further investigation is an unresolved issue, not an assurance that the system is satisfactory.

Conflicting information deserves a response. If an advertisement says 1,800 square feet while records say 1,500, identify the sources and seek appropriate verification. If the seller says an addition is permitted but cannot provide documentation, do not present the claim as established. Explain the uncertainty and let qualified authorities or professionals resolve the question.

For most covered housing built before 1978, federal law requires disclosure of known lead-based paint and lead hazards, available records, the prescribed warning language, and the EPA pamphlet before the buyer or tenant becomes bound. Buyers generally receive a ten-day opportunity to conduct a lead inspection or risk assessment, unless the parties agree to a different period or the buyer waives that opportunity in writing. This opportunity is distinct from an obligation to conduct testing: the federal disclosure rule itself does not generally require the seller to test.

California gives special treatment to certain sensitive information. Civil Code section 1710.2 addresses an occupant's death more than three years before the offer and HIV-positive status. A direct question cannot be answered with an intentional falsehood about matters covered by the statute's inquiry provision. Avoid the inaccurate blanket claim that every death always must be disclosed or that all sensitive personal information is a property defect. Evaluate the statute and materiality rather than circulating personal details unnecessarily.

A seller reports no roof issues, but the agent observes ceiling stains and receives an old inspection describing recurring leakage. The agent should disclose the observations and relevant known information, seek clarification, and recommend a suitable roof assessment. Repainting before a showing would not resolve the disclosure duty.

If the buyer receives a materially amended TDS electronically after acceptance in an agreed electronic transaction, the statutory five-day termination period must be considered separately from the contract's inspection deadline. A specialist report, disclosure delivery, and contractual contingency can each have different consequences and clocks.

An agent sees a crack running diagonally from a window. The defensible observation describes the visible condition and location. A diagnosis that the crack proves foundation failure requires expertise and investigation the agent may not possess. An assurance that it is only cosmetic is equally unsupported without a sound basis. Disclose the observation and obtain suitable specialist review rather than choosing whichever explanation keeps the transaction moving.

Inspection limits do not turn known information into inaccessible information. A statutory visual inspection may not require opening a wall, but an existing report about conditions behind that wall can still be material. Similarly, a permit-record search may fall outside the specified visual inspection, yet an agent who already knows an addition lacks required approval cannot ignore that knowledge by citing the inspection's ordinary limits.

A buyer who declines recommended investigation should understand the unresolved issue and applicable contractual consequences. Document the recommendation and the buyer's decision. An acknowledgment can help establish what happened, but it does not transform an agent's misleading statement into an accurate one or waive every legal duty.

A title report lists an easement; a survey depicts the driveway; a general inspection identifies drainage concerns; and a hazard report places the parcel in a mapped flood area. Each answers a different question. The buyer may need to understand both the legal right to use the driveway and the physical effect of water crossing it. A satisfactory title report does not establish that the driveway is well drained or that insurance will be inexpensive.

Read qualifications and recommended follow-up. A sewer inspection stopped at an obstruction does not establish that the unobserved segment is sound. A pest report limited to accessible areas does not certify the entire structure free of concealed damage. Report limitations are part of the information delivered, not fine print to ignore when summarizing the result.

If a third-party NHD uses the wrong parcel number, a neatly completed form does not cure the error. Obtain correction and reconsider any statements that depended on it. Being outside a mapped hazard area is also different from having no physical risk; disclose known site-specific facts rather than allowing the map's answer to contradict observed conditions.

Assume a represented seller must complete TDS sections I and II and the listing agent must complete section III. Emailing only I and II does not start the termination period while the required section III is missing. Under section 1102.3, delivery of the completed required sections matters, not merely the timestamp on the first attachment. A buyer's agent has a separate visual-inspection duty; that inspection does not become an additional TDS delivery trigger under this rule.

For covered pre-1978 housing, waiving the buyer's lead inspection opportunity is not waiving disclosure of known lead information or available reports. The federal ten-day inspection opportunity, California TDS termination period, contractual inspection contingency, and mortgage rescission right arise from different rules. On the exam, identify the transaction and document before selecting a remembered number. Several legally meaningful deadlines can coexist in one escrow without being interchangeable.

• TDS exemptions do not create permission to conceal material facts.
• The NHD concerns mapped hazards, not a guarantee of physical safety.
• Personal, mailed, and electronic TDS delivery have different statutory periods.
• Visual inspection is limited, but visible warning signs require attention.
• Reports complement one another; none is universal insurance against defects.