A Maryland 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 Maryland Have To Disclose Property Defects?
Maryland does require real estate sellers to disclose any material defects with the property. In most cases, this is through a standardized disclosure form provided by the state Department of Labor.
By mutual agreement, it may be possible to waive the use of a standard form and handle required disclosures another way. (The standard disclosure form contains proper language for a waiver at the end, if desired.) However, the seller always has a duty to disclose all material defects that are not obvious on a standard inspection of the property, even if the buyer agrees to take the property “as-is.”
This basic duty to disclose cannot be waived under any circumstances, unless the sale falls under a recognized legal exemption. Maryland exempts the following common cases, among others, from the disclosure form requirement:
- New construction that hasn’t been occupied
- Unimproved real estate
- Most properties exempt from § 13-207 transfer tax
- Foreclosures, tax sales, and similar sales due to default on debt owed
- Transfers related to execution of a deceased person’s estate
- Property that will be demolished, or otherwise converted to non-residential use
Required Seller Disclosures in Maryland
Maryland sellers of residential real estate must make the following disclosures, as appropriate, in order for a real estate purchase agreement to be considered legally binding:
- Residential Property Disclosure and Disclaimer Form: 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.
- 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.
Sources
- 1 Md. Code, Real. Prop. § 10-702(b)
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(1) This section applies only to single family residential real property improved by four or fewer single family units.
(2) This section does not apply to:
(i) The initial sale of single family residential real property:1. That has never been occupied; or2. For which a certificate of occupancy has been issued within 1 year before the vendor and purchaser enter into a contract of sale;
(ii) A transfer that is exempt from the transfer tax under § 13-207 of the Tax – Property Article, except land installment contracts of sale under § 13-207(a)(11) of the Tax – Property Article and options to purchase real property under § 13-207(a)(12) of the Tax – Property Article;
(iii) A sale by a lender or an affiliate or subsidiary of a lender that acquired the real property by foreclosure or deed in lieu of foreclosure;
(iv) A sheriffs sale, tax sale, or sale by foreclosure, partition, or by court appointed trustee;
(v) A transfer by a fiduciary in the course of the administration of a decedents estate, guardianship, conservatorship, or trust;
(vi) A transfer of single family residential real property to be converted by the buyer into a use other than residential use or to be demolished; or
(vii) A sale of unimproved real property.
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