home sale lawsuits are on the rise

6 Ways To Avoid Them

The real estate market is constantly evolving, and with change often comes new challenges. Home sale mediations and lawsuits are becoming more and more common, leaving sellers vulnerable and agents often caught in the middle. 

Sellers Shield has seen a 35% increase in post-sale disputes in 2023, compared to 2022. 

Note: These are disputes, received by Sellers Shield™, because the seller, or their agent, purchased Home Sale Legal Protection™. Sellers Shield™ does not have data on the number of sellers who did not purchase Home Sale Legal Protection™ and faced a post-sale dispute.

Rachel McKenna, Civil Trial Lawyer & Partner at Almanza, Blackburn, Dickie & Mtichell LLP shared with Sellers Shield that she tried more cases in 2023 than any previous year. She attributes this to buyers having unrealistic expectations. Despite accurate disclosures, inspections, and walk-throughs, buyers have preconceived notions about how the condition of the home should be and not how it actually is.

 

But there’s good news… Here are 6 ways to avoid home sale disputes and keep sellers, agents, and brokers out of the courtroom: 

Communicate Openly and Be Flexible 

Real estate transactions can present unexpected challenges. Advising clients to remain flexible can prevent minor issues from escalating into major disputes. Open communication between buyers, sellers, and agents is crucial. Encouraging regular updates and discussions help prevent misunderstandings and align expectations, smoothing the transaction process and significantly reducing the likelihood of post-sale disputes.

Provide Honest and Thorough Disclosure Forms 

Disclosure issues account for over 90% of post-sale claims, often surfacing months or years after the sale. Ensuring complete and accurate disclosure forms is essential. Reporting even minor issues builds trust with buyers and protects sellers from future liabilities. Every known problem, no matter how small, should be disclosed to safeguard all parties involved.

Sellers Shield Gold Standard Disclosure Process™ helps prevent claims and is free to use. Agents invite sellers to disclose in 90 seconds or less. It’s the same state forms that agents already use, but it features:

  • Expandable fields for detailed responses
  • Examples, tips, and definitions reduce questions for the agent & seller 
  • 100% complete & signed forms, every time

Conduct Property Inspections 

Home inspections are essential for uncovering defects that the seller might need to address or the buyer needs to accept. A detailed inspection report is a strong defense against post-sale disputes about property conditions. By disclosing the inspection report, even if the seller opts not to make repairs, they show diligence in informing the buyer about the property’s state, which can significantly reduce the seller from future liability.

Set Realistic Expectations 

Managing buyer expectations is crucial to avoiding disputes. Sellers and agents should ensure that buyers have a realistic understanding of the home’s condition and what to expect post-sale. This involves being upfront about any limitations or issues with the property and reinforcing that even with disclosures and inspections, no home is perfect.

Home Sale Legal Protection

Investing in a legal protection plan can provide peace of mind for sellers and their agents. Sellers can choose to purchase Home Sale Legal Protection™ during Sellers Shields’ disclosure process or anytime before closing. With this protection plan, sellers contact Sellers Shield at the first sign of trouble, even just a verbal threat from the buyer. Then they immediately:

  • Hire sellers a local, expert real estate attorney
  • Support sellers from start to finish
  • Pay up to $75,000 of their legal fees

Sellers Shield has helped resolve 94% of disputes before they escalated to lawsuits, keeping sellers and agents out of the courtroom.

Document Everything  

Keeping detailed records of all communications, agreements, and transactions is crucial. This includes emails, texts, inspection reports, disclosures, and any repairs or upgrades made to the property. Documentation serves as evidence in case of disputes, demonstrating that all necessary steps were taken and that the seller acted in good faith.

 

Conclusion

In the dynamic world of real estate, the rise in home sale lawsuits is a clear reminder of the importance of precautionary measures. By communicating openly, ensuring thorough and honest disclosures, prioritizing property inspections, setting realistic expectations, purchasing legal protection plans, and documenting everything sellers, agents, and brokers can navigate the complexities of home sales with confidence and peace of mind.

Proactive steps today can prevent legal battles tomorrow. Equip yourself with the right tools and knowledge to avoid disputes and ensure a smooth, successful property transaction. Whether you are a home seller, a real estate agent, or a broker, these strategies will help you stay ahead of post-sale issues.

Scott was sued for $200,000 two years after the sale of his home.

He never dreamed he would be served papers in his driveway.

real customer receiving lawsuit in drive way.

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