Unit 3: Disclosure Requirements

Question 1

What must the seller of a residential property do before signing the purchase agreement?

Answer 1

Filling out a seller’s disclosure in writing

Question 2

What is a material fact?

Answer 2

A fact that could adversely and significantly affect a buyer’s use and enjoyment in the property.

Question 3

T/F A seller may give the disclosure to licensee representing the buyer rather than the buyer.

Answer 3

True

Question 4

T/F Seller can’t rely on a qualified third party to make the disclosures.

Answer 4

False. Sellers can use a qualified home inspector.

Question 5

T/F A home being used as a methamphetamine lab must be disclosed.

Answer 5

True. There is an additional disclosure regarding this information.

Question 6

What are the 5 situations when disclosures are not required?

Answer 6

1. Third party inspection
2. Foreclosure
3. Selling to a current tenant
4. Selling to a family member
5. Gifting property

Question 7

While foreclosures do not require disclosures, what is the one exception?

Answer 7

A lender selling a home acquired in a foreclosure.

Question 8

In Minnesota, what are the 4 situations that are not considered a material fact?

Answer 8

1. HIV or AIDS
2. Suicide, accidental death, or natural death
3. Paranormal activity
4. Located in a neighborhood containing adult family home, community-based residential facility, or nursing home

Question 9

How long does an owner have to bring civil action to against past owner for failure to disclose?

Answer 9

Within 2 years of closing

Question 10

T/F Minnesota law requires sellers to disclose before signing and accepting an offer the presence of wells and septic systems on the property.

Answer 10

True

Question 11

What information about wells and septic need to be told?

Answer 11

1. Location
2. Compliance with laws
3. Use (working, not working, sealed)

Question 12

What is the time period a seller is liable for inaccurate well and septic disclosure?

Answer 12

Well is 6 years

Septic is 2 years

Question 13

Who issues a Certificate of Compliance?

Answer 13

A licensed septic inspector

Question 14

T/F The seller is required to supply the buyer with a current Certificate of Compliance for the septic system.

Answer 14

False. They do not need it to be current but provide any past certificates.

Question 15

For an existing septic system how long is a Certificate of Compliance valid?

Answer 15

3 years

Question 16

For a new septic system how long is a Certificate of Compliance valid?

Answer 16

5 years

Question 17

A property has added on another bathroom, what is required?

Answer 17

Certificate of Compliance

Question 18

Are storage tanks on a property considered material fact?

Answer 18

Yes and need to be disclosed.

Question 19

What size tank also requires compliance with the Pollution Control Agency?

Answer 19

A tank exceeding 1,100 gallons.

Question 20

What must be recorded if there is a leaking storage tank on a transferring property?

Answer 20

An affidavit

Question 21

How many days in advance does the PCA need to be notified of before either an installation or removal of a storage tank?

Answer 21

10 days

Question 22

How many days after installation or removal of a storage tank does the owner need to fill out the required PCA forms?

Answer 22

30 days