Whether you are buying or selling a house, you will definitely encounter TDS and SPQ disclosure reports during the transaction process. Professional realtors will also remind buyers or sellers to pay attention to these documents, because sellers can avoid risks and buyers can protect their rights and interests accordingly.

The full name of TDS is Real Estate Transfer Disclosure Statement, which is required by law for sellers to truthfully disclose material facts about the condition of the house when selling the house.

So what counts as a material fact? Important facts often involve information about a house's walls, ceilings, floors, roof, insulation, foundation, doors and windows, electrical systems, plumbing systems, and more, as well as information related to other structural components. But that's not all. Anything that affects the value of the property or affects the normal use of the property may be a material fact.

When filling in the TDS document, the seller must follow the principle of authenticity and fill it in truthfully. For example, when filling in this part (Figure 1 below), if any part is damaged or affects use, be sure to tick it truthfully and explain it on the horizontal line (Figure 2 below). For another example, this part asks whether there is a permit for house additions (Picture 3 below), and this part asks whether there is any litigation on the property (Picture 4 below). These contents must be answered truthfully.

If the seller intentionally conceals the information, he will face a very passive situation if the buyer takes him to court for fraud in the future. To give a simple example, if the seller did not disclose that the roof was leaking, and the buyer discovered that the roof was leaking after moving in, and also found traces of painting on the leaking area, the buyer may use this as evidence to prove that the seller concealed the defects. Therefore, disclosing important information as much as possible is a kind of protection for sellers.

However, it should be noted that TDS is not an exhaustive disclosure list, so the Seller property questionnaire, also known as the SPQ just mentioned, is a supplement to TDS, including many topics not covered by TDS, and allows sellers to provide additional explanations.

For example, item 7 below is a questionnaire about house repair and renovation, item 8 below is a questionnaire about house structure, systems and equipment, item 9 below is whether the property has ever made an insurance claim due to floods, earthquakes, fires and other disasters, item 10 below Whether there are molds and water-related problems in the house, item 11 below, whether pets have been kept in the house, whether there are pests, and whether relevant treatments have been done; item 12 below, whether neighbors can pass through your property; item 13 below, the garden of the property Is the greening infested with pests? Is there a swimming pool and SPA heater (hot spring heater), and what is its condition? item 14 below shows whether the property belongs to a condo and related issues; item 15 below shows whether there are any issues with the property rights; item 16 below shows the surrounding neighbors and how they get along with each other, etc. When the seller fills out the form, if he selects Yes somewhere, he must provide a corresponding explanation on the horizontal line below.

As mentioned earlier, truthful disclosure can reduce the possibility of misunderstandings by buyers as much as possible, which is a kind of protection for sellers.

It is also of great significance to buyers. First of all, the buyer can learn more detailed information about the condition of the property at the early stage of the transaction. Based on this additional information, the buyer can adjust the price, conduct some kind of inspection or require repairs, etc.; secondly, the buyer can also refer these disclosures as the basis for future claims or lawsuits alleging that the seller made false statements or intentionally concealed material facts.

Buyers should be reminded here that even if the seller fills in No, it is not a guarantee or commitment to the condition of the house, but is just a sincere memory of the seller in all aspects of the property. The questions asked in the SPQ questionnaire form are:" Are you aware of Have you noticed the following problems?" If the seller doesn't notice, he can fill in No. Therefore, SPQ cannot perform home inspection on the house on behalf of the buyer.

To sum up, the two disclosures TDS and SPQ are a kind of protection for both buyers and sellers. They encourage buyers and sellers to have open and honest discussions at the point of transaction to avoid possible disputes in the future to the greatest extent. If you have any questions during the process of buying or selling a house, please feel free to contact me.