Indiana Real Estate Purchase Agreement

Last Updated: September 5, 2024 by Roberto Valenzuela

An Indiana residential real estate purchase agreement (“Contract for Sale and Purchase of Real Estate”) is a contract which commits a buyer to an offer to purchase real estate, according to specific terms agreed by the buyer and seller. Negotiated specifics include the purchase price, financing method, closing date, and more.

Do Sellers in Indiana Have To Disclose Property Defects?

Indiana does require real estate sellers to disclose any material defects with a property, but state law is complicated on the specifics. In most cases, disclosure is done through a standardized disclosure form provided by statute, but any disclosure which provides the required information is valid.

While a property condition disclosure is required by law, Indiana applies a “caveat emptor” (buyer beware) rule when it comes to the accuracy of any disclosures. This places the full burden of checking the property’s condition on the buyer, as long as the buyer has a reasonable opportunity to do an inspection.

For example, if the seller says the condition of the roof is fine, and the buyer can perform a roof inspection but doesn’t, the buyer won’t be able to sue or reverse the purchase if the roof later turns out to have structural issues. Indiana courts have held that the buyer has full responsibility to do diligent inspection, even when the seller fraudulently misrepresents the state of a property.

Exceptions to the Disclosure Requirement in Indiana

Indiana does not allow waiver of the basic duty to disclose, unless the sale falls under a recognized legal exemption.  The following common transfers, among others, are exempt from the disclosure form requirement:

  • Court-ordered sales and transfers
  • Sales by foreclosure or other debt default
  • Transfer as part of the execution of a will or estate
  • Transfer to a purchaser who will not use the property for residential purposes
  • Transfer to a spouse, parent, or child
  • Transfers to or from a government entity

Required Seller Disclosures in Indiana

Indiana sellers of residential real estate must make the following disclosures, as appropriate, to meet legal requirements for a real estate purchase agreement:

  • Seller’s Residential Real Estate Sales Disclosure: Discloses material defects with a property that are known to the seller at the time of sale, and details any potential issues and conditions that may affect the value of the property.
  • Homeowners’ Association: If the property being sold falls under the rules and regulations of a Homeowners’ Association, the seller is legally obliged to supply the prospective buyer with all governing documents pertaining to the organization.
  • Lead-Based Paint Disclosure: Any home constructed earlier than 1978 must come with a disclosure upon the transfer of the property which includes any information about the presence of lead on the premises, as well as educational materials that communicate the health risks associated with lead exposure.

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