The major cause of post-sale disputes and lawsuits involve defects and disclosure. Most disputes can be avoided if proper disclosures are made.

The statutes governing seller disclosure obligations vary:

• State laws
  Most states require some form of seller disclosure. The form of disclosure also varies: Some states require a seller to complete a questionnaire about their property's condition; in other states, disclosures can be made verbally. In some states, seller disclosures are voluntary. The only sellers excluded from disclosure laws are banks and mortgage companies with foreclosure properties.
• Federal and local laws
  In addition to state mandates, some local and federal laws require sellers to make specific disclosures. Federal law, for example, requires sellers of homes built before 1978 to disclose any known lead hazards.
• Real estate company requirements
  Some major real estate companies require prospective sellers to complete a disclosure form before listing their property.

TIP:
A fact that is material to one buyer may not concern another. If you're wondering whether something should be disclosed, consult your real estate agent or a property attorney. Ask yourself if you'd want to have the information if you were the buyer. If the answer's yes, then disclose.

Structural defects are one thing; health risks from exposure to toxic chemicals are another issue altogether. Homebuyers are becoming increasingly concerned about environmental hazards and toxic materials in houses, especially in older homes. Common toxic substances include lead paint, lead pipes, asbestos insulation, asbestos ceilings, formaldehyde insulation and glues, and carbon monoxide or radon gases. Have your home tested for these substances. More buyers are requesting such tests, and may expect you, the seller, to correct the problem or offer a lower price to cover the cost of removing toxic substances.

Toxic Materials in the House

What is it?	Where is it?	What do you do?
Lead
A potentially lethal toxic metal that builds up slowly in the bloodstream, causing damage to the central nervous system, kidneys, circulation, muscles, joints, and hearing.	Chipped, cracked, or peeling paint (manufactured before 1978, when lead-based paints were banned) Pipes in older homes Soldered copper pipes in newer homes	Federal law requires you to disclose any knowledge of lead-based paints in your home, and include a federal form about lead-based paints with the sales contract. You are not required to have your home inspected for lead before you sell or to remove any lead-based paint.
Asbestos
A mineral substance that insulates and resists fire. Asbestos fibers are microscopic and can cause severe lung damage.	Wall insulation (mostly in homes built between 1930 and 1950) Siding Shingles Vinyl floor tiles Pipe insulation in older homes Textured paint and wall-patching materials manufactured before 1977	Disclose any known asbestos. If asbestos is contained, disclose it and leave it (removal can increase the health risk). If asbestos is loose or crumbling, it constitutes a health hazard and you may be required to remove the material before you can sell. Hire an expert to remove asbestos.
Radon
An odorless, invisible gas caused by the breakdown of uranium in the soil. Radon can cause lung cancer in concentrated amounts, and is primarily found in northern portion of the United States.	Basements Cracks in foundations Sump pumps Gaps in plumbing, wiring, ducts, or joints in structural parts of the house Wells	If you have your house tested for radon, you must disclose the results. Lowering radon levels can be a simple repair job, such as covering your sump pump-or it can require an expensive ventilation system that should be installed by an EPA-certified contractor.
Carbon monoxide
An odorless, invisible gas that renders the body incapable of absorbing oxygen. It is generated primarily by burning fossil fuels such as natural gas, propane, gasoline, wood, kerosene, or heating oil.	Furnaces Stoves Space heaters Wood-burning or gas fireplaces Automobiles	Disclose any previous carbon monoxide problems. Before you sell, have your furnace, stove, fireplace, and chimney inspected for any leaks or operating problems. Install a carbon monoxide detector on each floor of your home.
Formaldehyde
An acrid, colorless gas that can irritate the eyes, nose, and throat, and cause difficulty breathing. It is produced primarily by emissions from formaldehyde glues and resins in new building materials.	Building materials such as plywood, particleboard, hardwood paneling, and fiberboard Glues Paints Preservatives Some gas stoves and kerosene space heaters Foam insulation (found in many 1970s homes)	Disclose any formaldehyde problems you have experienced. Increase ventilation in the house to disperse fumes. Remove materials if possible. Seal new paneling with polyurethane.