California Seller Disclosures

The cornerstone of California seller disclosures. The TDS is a standardized form (Civil Code Section 1102.6) that requires you to disclose any known material defects or conditions affecting the property. It covers the condition of the roof, foundation, plumbing, electrical systems, heating/cooling, appliances, bathrooms, kitchen, windows, doors, floors, walls, ceilings, pools, spas, and more. You must answer honestly and completely — "do not know" is acceptable when truthful, but omitting a known issue is not.

California law requires sellers to disclose whether the property lies within any designated natural hazard zones. A professional NHD report typically covers earthquake fault zones, flood zones (FEMA flood maps), seismic hazard zones, wildfire hazard zones (Fire Hazard Severity Zones), and areas subject to tsunamis or dam inundation. The report is prepared by a third-party disclosure company and is typically paid for by the seller. The NHD report typically costs $100 to $125 and is usually ordered by the seller or the seller's agent.

For any residential property built before 1978, federal law requires sellers to disclose all known lead-based paint hazards and provide buyers with the EPA-approved "Protect Your Family from Lead in Your Home" pamphlet. You must also give buyers a 10-day opportunity to conduct a lead-based paint inspection or risk assessment at their expense. This is a federal requirement, not just a California rule, and the penalties for non-compliance are significant.

If your property is in a homeowners association (like Spencer's Crossing, Greer Ranch, The Colony, or Four Seasons), you must provide the buyer with a comprehensive HOA document package. This typically includes the CC&Rs (Covenants, Conditions & Restrictions), bylaws, financial statements (including reserve study), meeting minutes from the past year, and a statement of pending assessments or special levies. The HOA will also prepare a demand letter showing any outstanding fees or violations. Most HOAs charge a fee for compiling these documents.

California law requires you to disclose any known material defects — even if they have been repaired. Common examples include roof leaks (past or present), foundation cracks or settling, plumbing leaks or sewer line issues, electrical problems (faulty wiring, outdated panels), HVAC malfunctions, mold or water damage, pest infestations (termites, dry rot), soil or drainage problems, and window seal failures. When in doubt, disclose. It is always better to over-disclose than to face a lawsuit later.

Mello-Roos Community Facilities Districts (CFDs) are special tax districts that fund infrastructure and services in newer communities. If your property is in a Mello-Roos district, you must disclose the annual assessment amount and any remaining bonded indebtedness. This information is typically included in the NHD report or can be obtained from the county tax assessor. Buyers need to understand these ongoing costs as they directly affect affordability.

California law does not require you to guarantee the accuracy of square footage or property lines, but you must disclose what you know. If your recorded square footage differs from the county assessor's records or if you have made unpermitted additions or modifications, you should disclose that. Property line disputes, encroachments, or easements should also be disclosed. Many buyers will order a survey, and an undisclosed discrepancy can kill a deal or lead to post-sale litigation.

California law requires sellers to provide buyers with a notice that information about registered sex offenders is available from the local law enforcement agency or the Megan's Law database (www.meganslaw.ca.gov). This is typically included as a standard disclosure form in the seller's disclosure package. The seller is not required to research or provide specific information — only to inform the buyer that the database exists and how to access it.

Failing to disclose known material defects can have serious legal consequences in California. Under Civil Code Section 1102, a seller who knowingly conceals a material fact may be liable for damages, including the cost of repairs, diminution in value, and in some cases, punitive damages. Buyers can also rescind (cancel) the sale if they discover a material defect that was not disclosed. Beyond the financial risk, non-disclosure damages your reputation as a seller and can complicate future transactions. Honest disclosure protects everyone.

California Civil Code Sections 1102 through 1102.19 govern the transfer disclosure requirements for residential real estate sales. Key requirements include: the seller must provide a completed TDS to the buyer as soon as practicable before transfer of title; the disclosure applies to most residential properties with 1-4 units; certain transfers are exempt (new construction, court-ordered sales, foreclosures, and some others); the seller must also provide disclosures for any additional known conditions; and the buyer has the right to cancel the contract within three days (or five days) after receiving some disclosure documents. We ensure every statutory requirement is met for every transaction.

In California, sellers are required to disclose a death that occurred on the property within the last three years. This is considered a material fact that must be disclosed to potential buyers. If the death occurred more than three years ago, disclosure is generally not required unless the buyer specifically asks. Real estate agents may have their own additional policies about disclosing stigmatized properties, so ask your agent about their approach.