A SUMMARY OF THE TENNESSEE RESIDENTIAL PROPERTY DISCLOSURE LAW

 

THE SELLER OF PROPERTY FOR SALE WITHIN THE STATE OF TENNESSEE MUST PROVIDE DETAILED INFORMATION CONCERNING THE CONDITION OF THE PROPERTY.

 

For residential property of not less than one nor more than four dwelling units, prior to signing a Real Estate Sales Contract or certain other Agreements, the Seller must provide detailed information concerning the condition of the property, whether or not a Real Estate Agent is involved in the sale.   Compliance by a Seller is mandatory.

 

If a Real Estate Agent is involved in the transaction, the law requires only that the Real Estate Agent inform both the Seller and the Buyer of their responsibilities, rights and obligations under the Law.

 

The Disclosure Statement is not a warranty and is not intended to be a substitute for an inspection of

the property.

 

The Disclosure is provided for the Buyer’s exclusive use and may not be relied upon by a Buyer in a subsequent transfer.   The Disclosure from the Seller must be given in good faith.

 

The Seller is not required to undertake independent inspections or investigations of the property in order to complete the Disclosure. The Buyer may wish to obtain an Inspection.

 

The information in the Disclosure is provided by the Seller and not the Real Estate Agent.

 

The Disclosure may be waived by a Disclaimer, but only if the Buyer agrees.

 

Failure to provide a Disclaimer will not permit a Buyer to terminate a Real Estate Sales Contract; however, the Buyer may have other remedies.

 

The Seller is not liable for an error or omission in the Disclosure if:

(1)     The error or omission was not within the actual knowledge of the Seller or was  based on information provided by a public agency, or the report of an Inspector such as a Professional Home Inspector; 

(2) The Seller was not grossly negligent in obtaining the information.

 

It the Seller subsequently (but before the closing) determines that the information in the Disclosure was inaccurate, the Seller must disclose the inaccuracy to the Buyer.  In addition, If there are any material changes in the physical condition of the property between the time the contract is executed and the closing, then an updated Disclosure is required.

 

At the time of closing, the Seller will be required to provide a statement that no physical changes have occurred in the condition of the property between the time of the execution of the Disclosure and the date of closing.

 

If at the time the Disclosure is made,  the Seller does not have information concerning a certain matter, the seller may state that such information is unknown, or use an approximation of the information, but this provision may not be used for the purpose of evading the purpose of the Law.

 

The Real Estate Agent must inform potential Buyers of adverse facts concerning the property known to him/her, and can be held liable for intentional misrepresentation or defrauding a Buyer.

 

Matters such as a person being with HIV or other disease which has been determined by medical evidence to be highly unlikely to be transmitted through occupancy of a residence, or the occurrence at the residence of a homicide, felony or suicide, need not be disclosed.

 

The Buyer has a cause of action for defects existing at the time of the execution of the Contract, subject to certain limitations.  Any action must be brought within one year.

 

No cause of action may be instituted against a closing agent or attorney for failure of a Seller to provide a Disclosure or Disclaimer.

 

Failure of a Seller to provide the Disclosure or Disclaimer does not affect the status of the title.

The Law does not affect other remedies otherwise available.

 

Certain transactions are excluded from the requirements. ( see the Tennessee Property Disclaimer Statement Form )