When someone goes into contract to buy your home, they’ll have a “due diligence” period during which time they can and should investigate all aspects of the property. Preparing a full disclosure package for home buyers in advance, however, is time well spent.
The seller is required to make certain disclosures to the buyer during that due diligence period – usually within the first seven days under contract. A smart seller, however, will have already compiled a complete disclosure package before the property is ever listed for sale, and that disclosure package will be available for inspection for any and all buyers before they make an offer.
A full disclosure package – even if there are some things in there which may seem like they’d be red flags for a buyer – actually attracts buyers, because it answers questions and reduces uncertainty around the property. It builds confidence in the buying public: they know that they’re working with a seller who has nothing to hide, is honest and forthright and is ready to do business.
Having a full disclosure package available will reduce friction, both before and during the sale. When a buyer is interested in a property, they will often have many questions. If the answers to these questions cannot be found in the disclosure package, waiting or searching for answers will slow up the buyer, either before they make an offer, or during their due diligence period when they are investigating the property. Remember: time kills deals. You want a buyer to be able to slide right into contract quickly and easily, and close smoothly as well.
By having a complete disclosure package available for buyers, you’re making it clear that the list price of your property has already fully accounted for all the material aspects of the property, as-is, where-is. Getting all the disclosures ready up-front helps to avoid a situation where a buyer, either on their own or as the result of a disclosure made by the seller after they went under contract, learns a material fact about the property which they were not aware of at the time they made the offer.
When this happens, it’s almost inevitable that there will be some re-negotiation of the deal, a delayed closing, cancellation of the sale, or possibly even litigation. These are things which can almost entirely be avoided by preparing a complete disclosure package up front, before any offer is made.
Crucially, having the disclosures made up front will usually result in a stronger selling price, as it greatly limits a buyer’s ability to re-negotiate the terms or price of the deal based on their own due diligence. If there’s nothing more to uncover beyond what’s been disclosed to them, they’ll be hard pressed to come up with a legitimate reason for a lower price later.