Full disclosure is a key component of business transactions. When it comes to property deals, disclosure is vital. Most real estate transactions include a full disclosure requirement meaning all details of the deal are truthful and forthcoming to the best knowledge of the parties involved. Special emphasis is placed on disclosure of any items that would cause the other party to withdraw from a deal. A business attorney can help make sure full disclosures exist and are written appropriately to protect your interests in a transaction.
Most states require agents to sign notices of disclosure under penalty of perjury. This underscores the importance government places of full disclosure even when a full disclosure agreement doesn’t exist in the transaction documents. The full disclosure requirement makes it so if an agent or broker knowingly falsifies any information related to the deal, they can face legal and criminal penalties. The requirement doesn’t only cover agents, though. If a party to the transaction is found to have knowingly falsified documents or claims, they could also face prosecution.
Full disclosure in deals means that the sell-side must provide any and all defects or other information that could potentially discourage the buy-side from pursuing the deal. It is most often mentioned in conjunction with agents and brokers because in most real estate deals agents and brokers are hired to represent both sides of a transaction.
Some basic information agents representing buyers are required to provide include:
- If a seller will accept a lower offer than the buyer has given.
- Any pertinent urgent circumstances around a sale.
- Property value estimates.
- Information on any other existing offers or seller counteroffers.
- The length of time a property has been on the market.
- Any other information that could present the buyer with a better deal
Brokers and agents representing a side of a transaction must make sure their clients are entering a deal with all information possible available to them. Both parties, the seller and buyer, must know all the details of a deal for it to go through. If it’s discovered that some information was withheld that would be material to the deal could bring penalties.
Finding a business attorney who can walk you through the ins and outs of full disclosure is a best practice to protect yourself in real estate transactions. Whether you are a seller or a buyer, an attorney familiar with full disclosure requirements can give you the peace of mind you need to close a deal. They can ensure you gather all information legally obligated to you like dates of offers, inspections, any reports related to a piece of property and if there is anything suspicious in a deal. We also draft full disclosure agreements and can consult clients on disclosure requirements. The Woodall Law Firm PLLC has expertise in dealing with full disclosures. Our firm in The Woodlands, TX stands ready to help all our clients enter deals armed with information so they can have confidence in what they are buying or selling.