Before you put your home on the market, you don’t want to skip over one of the most important steps — filling out a seller’s disclosure form. Learn exactly why this form will protect you down the road and what specifically you need to know about Alaska’s disclosure requirements.
There’s a lot of moving parts when you’re in the midst of the home selling process. You’re negotiating offers, working with local agents, handling finances, staging your home, and gathering all the necessary paperwork — including one crucial document, a seller disclosure report.
What is a Seller’s Disclosure?
A seller’s disclosure report is typically a form sellers fill out identifying the condition of their home and disclosing to the buyer any known problems or damage.
In Alaska, the seller’s disclosure form is nine pages long asking the seller to not only to describe the features of their home, but to also divulge any damage that can range from problems with the roof, foundation, and sewer, to issues with permits, electrical systems, and pests.
Seller’s disclosures are both beneficial and critical to the buyer and seller. For the buyer, the disclosure provides them with ample information about the home and alerts them of any major problems that would need to be fixed before the buyer considers purchasing the house.
For the seller, the disclosure protects them legally, if down the road, the buyer attempts to sue the seller claiming there’s extensive damage or problems with the home. But because the home’s faults were initially reported in the disclosure, you as the seller would be covered.
The seller’s disclosure can also be a good barometer for the buyer’s level of interest.
Unlike the majority of states, Alaska is part of the few that require a seller’s disclosure before buyers can even make an offer.
So if even after the buyer sees the disclosure and potential issues with the home and still makes an offer, it’s a decent sign that the buyer is motivated and will more likely follow through in purchasing the home.
The Advantages of Getting an Inspection
Most people selling their homes are not construction professionals or highly trained plumbers. Rather, sellers tend to discover as they fill out a seller’s disclosure, they’re not completely certain about all potential damages or problematic aspects of their home.
Many times sellers have no way of knowing major problems like if the foundation is unstable or if asbestos has crept into their attic.
While sellers should fill out the seller’s disclosure honestly and with as much detailed information as possible, it may be in the seller’s best interest to have their own inspection.
Even though in Alaska it is not required by law that the seller has an inspection and most likely the buyer will have their own inspection, if you as the seller do decide to have your own inspection, it could save you some trouble in the future.
The inspection could turn up problems you were unaware of and give you more time to decide which damages you should repair as well as more time to gather finances in order to fix any issues.
If you do decide to get an inspection before you fill out the seller’s disclosure, in Alaska, your inspector is required to be licensed by the state.
Additionally, it’s advised to hire an inspector with “errors and omissions insurance” so that if the inspector overlooks anything that should have been detected, you have a right of recovery against their insurance.
What You Need to Disclose in Alaska
When you own a home, there’s always innumerable problems that can crop up with your house. So what exactly are you required to disclose to the buyer?
Because Alaska is situated so far north and deals with more extreme cold temperatures, there are some specific issues you as the seller must disclose.
For instance, the seller’s disclosure specifically asks about ‘Freeze-ups’ where you’ll need to disclose if you’ve had any problems with freezing water lines, plumbing issues, or if your heating system has malfunctioned in any way.
Alaska also asks you disclose any soil problems with permafrost.
Permafrost, soil that remains frozen year after year, can pose a major problem for homes if the permafrost begins to thaw. Once the soil softens and gives way, any houses built on permafrost ground can become dangerously unstable.
Additionally, Alaska recently passed a law that requires sellers to disclose any suicides or homicides that occurred in the home within one year of the home’s showing. And like all states, if your house was built before 1978, you’ll have to disclose any lead-based paint in the home.
While most of these disclosures are major issues, also be aware that you’re required to disclose any problems that might make your home less valuable. For instance, if you live near a noisy business, loud airport, or the neighbor’s dog barks constantly through the night.
Know that what you don’t need to disclose is if a tile in the bathroom is cracked or if one kitchen cabinet doesn’t like to close all the way.
But before you start filling out the seller’s disclosure form, it’s always best to have a second opinion and seek advice from an experienced real estate agent who can guide you on exactly what must or should be disclosed and what isn’t required.