sell house in alabama

Three Legal Issues to Consider Before Listing Your Home for Sale

When it comes to real estate, Alabama is considered a seller-friendly state. This is thanks to the ‘caveat emptor’ doctrine. The doctrine allows you to sell your home without disclosing every single detail about the physical condition of your property. In this article, we will take a detailed look at the caveat emptor doctrine and the three important legal issues you need to be aware of while selling your home.

How Does the Caveat Emptor Doctrine Work?

Caveat emptor is a Latin phrase which stands for ‘let the buyer beware’. It is basically a disclaimer which is used in transactions where products or services are bought, sold, or exchanged between two or more parties.

In Alabama, the sale of residential properties is governed by the doctrine of caveat emptor, which means the seller is not legally obligated to disclose all the details about the physical condition of the property they are trying to sell. On the contrary, it is the responsibility of the buyer to inspect the property carefully, find out if there are any defects, and determine if the property is worth buying.

Most other states in the country require sellers to disclose every known detail about their property – in writing – before they sell it to someone. In this aspect, Alabama stands out from the rest, which is certainly good news if you are a seller. At the same time, the caveat emptor doctrine does not give you a free pass to sell your property to someone without revealing any information whatsoever.

There are three exceptions to the caveat emptor doctrine which you need to be aware of if you are planning to list your home for sale:

1. The Fiduciary Relationship Exception

If the relationship between you and the buyer can be described as ‘fiduciary’ – wherein you are legally obligated to act in the buyer’s best interest – you are not allowed to withhold certain kinds of information, especially if doing so might harm the buyer’s interests.

For example, let us assume that you are a doctor and the buyer is a patient of yours. If the buyer is allergic to cedar wood, and if the doors, windows, or closets in the house you are planning to sell are made of cedar wood, you cannot withhold the information from the buyer as doing so might be a breach of your fiduciary duty towards them.

Similarly, if you happen to be the financial advisor of the buyer and if you know that the cost of repairing and refurbishing your house is likely to be much higher than its resale value, you are legally obligated to disclose the information to the buyer prior to the sale.

If you have any kind of professional relationship with a potential buyer – wherein the buyer pays you for your services – it’s a good idea to consult a lawyer and find out if your relationship can be described as fiduciary in nature.

2. The Health and Safety Risk Exception

If there are any defects in your house that could post a threat to the buyer’s health and safety, you are required to disclose the details of the same prior to the sale.

For example, you are supposed to inform the buyer of the presence of hazards like asbestos, lead paint, and black mold. Similarly, if your house has major structural defects – weak foundation, damaged roof, or a severely damaged attic that could give way at any time – you are legally obligated to disclose the details to the buyer.

3. The Direct Question Exception

If a potential buyer asks you a direct question regarding the presence of a safety hazard or a structural defect in your house, you are not allowed to evade the question or lie about it for any reason.

Potential Consequences of Suppressing Information from the Buyer

If you fail to disclose certain information about your property to the buyer, despite the fact that you have a fiduciary relationship with the buyer or if you know that withholding the information can pose a serious threat to the health and safety of the buyer and their family, the buyer can take legal action against you and seek damages from you.

Similarly, if you lie about a defect in your house despite being asked about it – and if the buyer or any of their family members suffer an injury or develop a health problem as a result of it – you can be charged with misrepresentation, suppression of material facts, negligence, or fraud, depending on the circumstances.

Residential Real Estate Services in Alabama

If you are thinking of selling your home, it is a good idea to have an experienced real estate attorney by your side as they can make sure that you are not in violation of the legal doctrine that governs the sale of residential properties in Alabama.

The residential real estate lawyers at Davis, Bingham, Hudson, & Buckner, P.C. can help you with the sale of your property, let you know what kind of details you should reveal to the buyer, and provide all other types of legal guidance with real property transactions. Call our office today at 334-821-1908 or message us online to schedule a consultation with one of our attorneys.

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