Duty To Disclose (Legal Question) - Posted by Jeff

Posted by roger on September 05, 2003 at 16:00:04:

my answer was to the question should he disclose any defects in the property and my answer was yes to stop any future court action/// i did post this on the right question asked didn’t i?

Duty To Disclose (Legal Question) - Posted by Jeff

Posted by Jeff on September 04, 2003 at 21:52:10:

As a Mortgage Holder foreclosing on a property, is there any duty to disclose the condition of the property to prospective bidder/buyers?

For example, say I am a mortage holder, and I’m aware of major foundation problems with property. Do I have a duty to disclose this when holding a trustee sale?

Thanks in advance

Jeff

Re: Duty To Disclose (Legal Question) - Posted by Stu Harnden

Posted by Stu Harnden on September 04, 2003 at 23:00:32:

I would say It not only your duty but your obligation to disclose a major flaw as a foundation problem. If not only for your reputation, but your legal problems you would be sure to get later on.
Just a thought.

It is a state-specific issue - Posted by Ronald * Starr(in No CA)

Posted by Ronald * Starr(in No CA) on September 04, 2003 at 22:25:20:

Jeff--------------

Here in CA, the answer is “yes.” There was a lawsuit about 15 years ago where this was the issue. House in Southern CA starting to slide down the hill, if I recall correctly.

However, you need to find out if there is any law to that effect where you are. Some states are more consumer friendly than are other states. CA is quite consumer friendly. If you are in TX or OK, I doubt it. That the wild west.

You need to consult with a local knowledgeable source, I opine. I suggest an attorney who specializes in foreclosures or else the people who conduct the foreclosure auctions in you state, which you do not mention.

Good InvestingRon Starr*********

Re: It is a state-specific issue - Posted by Jeff

Posted by Jeff on September 05, 2003 at 09:04:45:

I’m in Texas…Of course the lenders always explain the “as is” “no warranty” stuff before they foreclose and sell the property, but I’ve never heard them disclose anything regarding the condition (even if they know about a problem)

Re: It is a state-specific issue - Posted by roger

Posted by roger on September 04, 2003 at 23:34:47:

disclose all you know that is wrong with the property,have buyer sign letter that you told them of the problems you know of ,this saves you in any court ,yes in texas you must tell any defects of any real estate you sell or buyer can get the courts to make you fix any defects

Re: It is a state-specific issue - Posted by Ronald * Starr(in No CA)

Posted by Ronald * Starr(in No CA) on September 05, 2003 at 24:54:31:

Roger–(TX)--------------------

But the questionner was asking about a specific situation: foreclosure on a loan. This question is not aimed at the usual owner-selling-a-property situation.

One problem, of course, is that the organization conducting the foreclosure activity may have no knowledge of the property. The usual property owner knows what the property is like, having been in it.

Also, the foreclosure auctions in CA always have warnings at the beginning of the sale that the properties are being sold “as is, where is. With no warranties, expressed or implied, as to the address or the location of the property” and much more.

Good InvestingRon Starr***

Re: It is a state-specific issue - Posted by roger

Posted by roger on September 05, 2003 at 16:08:19:

went back and reread the question and of course you are right thanks for the info .
have read you on cre when you answer question and such, injoy your advice a great deal, thanks again for the correction