Selling a Davis County Home With Past Water Damage: What Do You Have to Disclose?

In general, a seller should disclose what they know about water problems in the home, including leaks, flooding, seepage, past repairs and insurance claims related to water. Disclose it clearly and in writing, and keep the paperwork that shows what was fixed. Hiding a known problem is the choice that creates legal risk. Disclosing one rarely ends a sale.

Charisse Walker is a real estate agent with Chalker Properties Group in Salt Lake and Davis County, Utah, and a licensed mortgage lender. She is not an attorney, and the exact duties depend on Utah law, the forms in your contract and the facts of your home. If you are unsure what a form requires, ask your broker or a Utah real estate attorney before you list.

This article covers what sellers usually need to gather, how to describe past damage honestly, what buyers tend to ask and how to handle repairs before listing.

Buyers and their inspectors look for any history of water entering a place it should not be. For most Davis County homes, that means a short list:

• A basement or crawl space that took on water, from groundwater, a window well or a sump pump failure
• A roof leak that stained a ceiling or wet the attic insulation
• A burst or leaking pipe, water heater or appliance line
• A slow leak under a sink or around a tub that rotted wood
• Sewer or drain backups
• Ice dams that sent meltwater under shingles in winter

Past does not mean unresolved. A leak that was found, fixed and dried out properly is a different story from one that was covered with paint. Buyers mostly want to know which one yours is.

Basements matter more in a county where so many homes have them. If yours is finished, the article on selling a Davis County home with a basement apartment and the one on what buyers verify in finished basements show the questions that come up.

Your best protection is paper. Before you disclose anything, collect what you have:

1. The date and cause. Write down when the water got in and what caused it, as far as you know.
2. Repair invoices. Plumber, roofer, drying company or contractor receipts that show what was done, by whom and when.
3. Permits. If the repair needed one, keep the permit and any final sign-off.
4. Photos. Photos of the damage and the repair help show that the work was real.
5. Warranties. A warranty on the repair may transfer to the buyer.
6. Insurance paperwork. A claim summary, if you made a claim, and what the payout covered.

If you bought the home recently, look at your own inspection report and the disclosures the prior owner gave you. They may mention history you should pass along.

Insurance claims leave a record. Buyers' insurers can often see prior claims on a property, so a claim is better volunteered than discovered. Ask your agent how your contract's disclosure forms handle claims.

Stick to facts, dates and what was done. Avoid guesses, minimizing words and promises you cannot keep.

Compare two ways of saying the same thing:

• Vague: "There was some minor moisture once but it is all fine now."
• Clear: "In spring of last year, water entered the northeast corner of the basement during snowmelt. A contractor installed a window well cover and regraded the soil. Invoices attached. No water has been observed since."

The second version tells the buyer what happened, what was done and where to find proof. It also does not claim that the problem can never return, which no seller can know.

Say only what you know. If you were not living in the home during the problem, say what the records show and where your knowledge ends. The guide on Utah seller disclosure forms explains how the forms work and why completeness protects you.

It depends on what is wrong and what you can prove.

If the cause is fixed and documented, disclose and attach the records. That is the simplest path, and many buyers accept it.

If the cause is not fixed, you have two choices. You can fix it before listing, which gives buyers a cleaner story, or you can sell the home as-is and price it for the work still needed. Selling as-is does not remove the duty to disclose what you know. The guide to selling a home as-is in Utah covers where that line sits.

If there may be mold or rot, have a qualified professional look at it before you list. Guessing is how sellers end up renegotiating from a weak position after a buyer's inspection finds it first.

A pre-listing inspection can help you see what a buyer will see. The article on pre-listing inspections weighs the tradeoffs, and the same logic applies in Davis County.

Be ready for questions like these, and have the answers in writing:

• When did it happen, and has it happened again?
• What caused it?
• Who did the repair, and is there an invoice?
• Was a permit needed, and was it closed?
• Was there an insurance claim?
• How do the sump pump, window wells, gutters and grading work now?
• Are there any areas of the house that have not been opened up or inspected?

Buyers often respond to a documented fix with relief. They fear surprises more than they fear a history. A seller who hands over a tidy folder tends to get a calmer inspection and fewer demands.

This is a typical example, not a description of a particular client. A seller in Davis County had water come through a basement window well during a heavy storm two springs ago. They had a contractor extend the window well, regrade the soil and replace damaged drywall. They kept the invoices and photos.

Before listing, the seller and their agent put the history in the disclosure with dates and attached the invoices. A buyer's inspector found a stain on a basement wall that matched the disclosure. A moisture reading was normal. The buyer asked for the contractor's contact information, got it and moved on.

Compare that to a seller who painted over the stain and said nothing. When the inspector finds it, the buyer wonders what else is being left out, and the negotiation changes. The honest version costs little. The hidden one can cost the sale and, later, much more.

Do I have to disclose a leak that was fully repaired?

Generally, a past problem that you know about is something to disclose, even if it is fixed, along with proof of the repair. Check the wording of the forms in your contract, and ask your broker if you are unsure.

Do I have to disclose an insurance claim?

Ask your agent how your forms treat claims. Whether or not a form requires it, a claim leaves a record that buyers' insurers can often see, so being upfront usually works better.

What if I do not know the full history because I bought the home recently?

Disclose what you know and share the prior owner's disclosures and your own inspection report. Do not state things you cannot support.

Will disclosing water damage lower my price?

It can, depending on the issue, the proof and the market. A documented repair usually affects price much less than a surprise found during inspection.

Should I talk to an attorney?

If the damage is large, the cause is unclear or you are unsure what the forms require, yes. Your agent can explain how the process works but cannot give legal advice.

Charisse Walker is a real estate agent with Chalker Properties Group in Salt Lake and Davis County, Utah, and a licensed mortgage lender. When she is your agent, she helps sellers gather their records, complete the disclosure forms accurately and decide whether to repair before listing. The goal is a sale that holds together through inspection.

If you are preparing to list, the selling your home page outlines the steps. The Layton area page covers local conditions, and the process page explains how Charisse works with sellers.

Have a home with a history you want to handle well? Contact Charisse and she will go through it with you before you list. This article is general information and not legal advice.