Choosing to buy real estate, whether residential or commercial in nature, is a big decision. While it can be a massive investment that you hope will pay dividends in the future, the truth is that far too many people end up with property that isn’t as good as they were led to believe. This can put you at risk of losing a significant amount of money, and it may even threaten your business with disrupted operations and decreased longevity.
Therefore, before you agree to purchase real estate, you need to have a clear understanding of what you’re getting into. This is where due diligence can prove helpful, but you also need to carefully analyze any disclosures that the seller makes regrading the property in question.
What is the seller required to disclose?
Under Florida law, sellers of real estate are required to disclose any defects that are significant and not easily observable to the buyer. The seller only has to disclose those defects that it’s aware of, though, which is why it’s critically important that you still have thorough inspections that can identify any issues that may be hidden from your view.
It’s worth noting, though, that sellers are only required to disclose material defects. These are defects that impact the value of the property, the buyer’s readiness to purchase the property, or health and safety.
There are many issues that may trigger the requirement to disclose defects. Electrical wiring issues that pose a fire threat, for example, will likely need to be disclosed, as would other environmental issues. But if you find out that a major issue exists, then you should analyze the matter closer to determine if it’s a material defect that should’ve been disclosed.
What do you do if the seller fails to disclose important information?
If you purchase a property and later discover that the seller failed to disclose important information that should’ve been disclosed in accordance with the law, then you might have two options. The first is to seek to get out of the purchase agreement. You might be successful in doing this if you can show that you detrimentally relied on the seller’s assertions, or lack thereof, and that you would not have bought the property if you had known of the material defect that was withheld from you.
Your second option is to seek damages. If you’ve occupied the property for a while before you discover the material defect in question, then it might be difficult to back out of the deal that was completed prior. In these instances, though, you might be able to show how the material defect has financially harmed you.
For example, if you’re required to close your business while your building is completely rewired due to material electrical issues, then you may have a claim for the cost of the rewiring plus any lost revenue that otherwise would’ve been generated if your business had been open during that time.
Do you need help with your real estate legal issues?
An improperly handled real estate transaction can leave you with significant financial losses. You want to avoid that outcome at all costs, which is why you’ll want to ensure that you’re doing everything you can to protect yourself throughout the process.
This may include acquiring legal assistance when complex transactions or disputes arise. With a competent attorney by your side, you might be able to avoid common pitfalls that would leave you with unwanted outcomes that could cost you a fortune.