California Real Estate Law Disclosure Chart *1Copyright©2003 California Association Of Realtors® (C.A.R.). Permission is granted to C.A.R. members only to reprint and use this material for non-commercial purposes provided credit is given to the C.A.R. Legal Department. Other reproduction or use is strictly prohibited without the express written permission of the C.A.R. Legal Department. All rights reserved.
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| Subject |
Disclosure Trigger |
Disclosure
Requirement
(Brief Summary)
Form
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C.A.R. Information Source
Law Citation
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Agent’s Real Property Inspection
1
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Sale *2of all residential real property of 1-4 units (No exemptions except for never-occupied properties where a public report is required or properties exempted from a public report pursuant to Business & Professions Code § 11010.4)
Also applies to Manufactured Homes (as defined in H&S § 18007, which includes personal property Mobilehomes)
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A real estate licensee must conduct a reasonably competent and diligent visual inspection of the property; this inspection duty does not include areas which are reasonably and normally inaccessible, off the site, or public records or permits concerning the title or use of the property; this inspection duty includes only the unit for sale and not the common areas of a condo or other common interest development.
There is no requirement that the inspection report be in writing; however, it is recommended that all licensees put it in writing.
C.A.R. Form TDS (or for mobilehomes and manufactured housing, C.A.R. Form MHTDS) may be used. If the seller is exempt from the TDS, then C.A.R. Form AID may be used by the agent.
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Cal. Civ. Code
§§ 2079 – 2079.6 |
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Commercial or Industrial Zone Location
2
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Transfer *3or exchange of residential real property of 1-4 units. |
The seller of real property subject to the TDS law must disclose "actual knowledge" that the property is affected by or zoned to allow an industrial use of property (manufacturing, commercial, or airport use) as soon as possible before transfer of title.
C.A.R. Form TDS may be used.
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Cal. Civ. Code § 1102.17; Cal. Code Civ. Proc. § 731a |
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Death and/or AIDS
3
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Sale, lease, or rental of all real property. |
The transferor/agent has no liability for not disclosing the fact of any death which occurred more than 3 years prior to the date the transferee offers to buy, lease, or rent the property. Any death which has occurred within a 3-year period should be disclosed if deemed to be "material."
Affliction with AIDS or death from AIDS, no matter when it occurred, need not be voluntarily disclosed. However, neither a seller nor seller’s agent may make an intentional misrepresentation in response to a direct question concerning deaths on the property.
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"Disclosure of Aids and Death: The Legislative Solution"
Cal. Civ. Code
§ 1710.2.
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"Drug Lab" – Illegal Controlled Substances Contamination
4
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Transfer *4 or exchange of residential real property of 1-4 units and lease of any residential dwelling unit.
Same exemptions as for the Transfer Disclosure Statement.
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In the event that toxic contamination by an illegal controlled substance has occurred on a property and upon receipt of a notice from the Dept. of Toxic Substances Control (DTSC) or other agency—or if the seller has actual knowledge of the toxic contamination—the seller must disclose this information to the buyer by checking item II.C.1 of the TDS form and attaching the DTSC notice, if there is one.
In the case of rental property, the landlord must give a prospective tenant written notice of the toxic contamination. Providing the tenant with a copy of the DTSC notice will suffice if there is such a notice.
C.A.R. Form TDS may be used.
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Cal. Civ. Code
§§ 1102.18, 1940.7.5 |
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Earthquake Fault Zones *5
5
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Sale of all real property which does contain or will eventually contain a structure for human occupany and which is located in an earthquake fault zone (special studies zone) as indicated on maps created by the California Division of Mines and Geology. *6
Also applies to Manufactured Homes (as defined in H&S § 18007, which includes personal property Mobilehomes)
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The seller’s agent or the seller without an agent must disclose to the buyer the fact that the property is in an earthquake fault zone (special studies zone), if maps are available at the county assessor’s, county recorder’s, or county planning commission office, or if the seller or seller’s agent has actual knowledge that the property is in the zone. If the map is not of sufficient accuracy or scale to determine whether the property is in the zone, then either the agent indicates "yes" that the property is in the zone or the agent may write "no" that the property is not in this zone, but then a report prepared by an expert verifying that fact must be attached toC.A.R. Form NHD.
If a TDS is required in the transaction, either C.A.R. Form NHD, "Natural Hazard Disclosure Statement," or an updated local option disclosure form must be used to make this disclosure.
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"Natural Hazard Disclosure Statement"
Cal. Pub. Res. Code §§ 2621 et seq.;
Cal. Civ. Code § 1103
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Earthquake Hazards – Homeowner’s Guide
6
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Mandatory delivery:
Transfer of residential real property of 1-4 units, manufactured homes, and mobilehomes, of conventional light frame construction, and built prior to January 1, 1960, if not exempt (almost same exemptions as for the Transfer Disclosure Statement *7). Additional exemption if the buyer agrees, in writing, to demolish the property within one year from date of transfer.
Voluntary delivery:
Transfer *8of any real property.
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Mandatory delivery:
The licensee must give the transferor the booklet "The Homeowner’s Guide to Earthquake Safety" *9and the transferor must give this booklet to the transferee.
Known structural deficiencies must be disclosed by the transferor to the transferee and the form in the booklet entitled "Residential Earthquake Hazards Report" may be used to make this disclosure.
Voluntary delivery:
If the Guide is delivered to the transferee, then the transferor or broker is not required to provide additional information concerning general earthquake hazards.
Known earthquake hazards must be disclosed whether delivery is mandatory or voluntary.
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Cal. Bus. & Prof. Code
§ 10149;
Cal. Gov’t Code
§§ 8897.1, 8897.2, 8897.5.
Cal. Civ. Code
§ 2079.8. |
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Earthquake Hazards – Commercial Guide
7
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Mandatory delivery:
Sale, transfer, or exchange of any real property or manufactured home or mobilehome if built of precast concrete or reinforced/unreinforced masonry with wood frame floors or roofs and built before January 1, 1975, located within a county or city, if not exempt.
Same exemptions as for Homeowner’s Guide.
Voluntary delivery:
Transfer of *10 any real property.
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Mandatory delivery:
The transferor/transferor’s agent must give the transferee a copy of "The Commercial Property Owner’s Guide to Earthquake Safety." *11
Voluntary delivery:
If the Guide is delivered to the transferee, then the transferor or broker is not required to provide additional information concerning general earthquake hazards.
Known earthquake hazards must be disclosed whether delivery is mandatory or voluntary.
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Cal. Bus. & Prof. Code § 10147, Cal. Gov’t Code §§ 8875.6, 8875.9, 8893.2, 8893.3,
Cal. Civ. Code § 2079.9. |
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Flood Hazard Areas (federal law)
8
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Sale or lease of all improved real estate or mobilehomes located in flood hazard areas as indicated on maps published by the Federal Emergency Management Agency. *12
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The seller/lessor should disclose to buyer/lessee the fact that the property is located in such an area. *13
C.A.R. Form TDS may be used (or for mobilehomes and manufactured housing, C.A.R. Form MHTDS). |
42 U.S.C. §§ 4001 et seq., § 4104a. |
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"Special Flood Hazard Area" (state law)
9
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Sale of real property located in Zone "A" or " V" as designated by FEMA and if the seller or the seller’s agent has actual knowledge or a list has been compiled by parcel and the notice posted at a local county recorder, assessor and planning agency.
Also applies to Manufactured Homes (as defined in H&S § 18007, which includes personal property Mobilehomes) |
The seller’s agent or the seller without an agent must disclose to the buyer if the property is in this Special Flood Hazard Area, if a parcel list has been prepared by the county and a notice identifying the location of the list is available at the county assessor’s, county recorder’s or county planning commission office, or if the seller or seller’s agent has actual knowledge that the property is in an area.
If a TDS is required in the transaction, either C.A.R. Form NHD, "Natural Hazard Disclosure Statement" or an updated Local Option disclosure form must be used to make this disclosure.
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"Natural Hazard Disclosure Statement"
Cal. Civ. Code
§ 1103,
Cal. Gov’t Code § 8589.3
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"Area of Potential Flooding" (in the event of dam or reservoir failure) (state law)
10
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Sale of all real property if the seller or the seller’s agent has actual knowledge or a list has been compiled by parcel and the notice posted at a local county recorder, assessor and planning agency.
Also applies to Manufactured Homes (as defined in H&S § 18007, which includes personal property Mobilehomes)
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The seller’s agent or the seller without an agent must disclose to the buyer if the property is in this Area of Potential Flooding as designated on an inundation map, if a parcel list has been prepared by the county and a notice identifying the location of the list is available at the county assessor’s, county recorder’s or county planning commission office, or if the seller or seller’s agent has actual knowledge that the property is in an area.
If a TDS is required in the transaction, either C.A.R. Form NHD, "Natural Hazard Disclosure Statement" or an updated Local Option disclosure form must be used to make this disclosure.
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"Natural Hazard Disclosure Statement"
Cal. Gov’t Code
§§ 8589.4, 8589.5;
Cal. Civ. Code § 1103
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Flood Disaster Insurance (federal law)
(Applicable for any flood disaster *14 declared after September 23, 1994)
11
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Any transfer *15of personal (e.g., mobilehomes), residential, or commercial property where the owner received federal flood disaster assistance conditioned on the owner subsequently obtaining and maintaining flood insurance. |
The transferor must notify the transferee in writing on a document "evidencing the transfer of ownership of the property" about the requirement to obtain and maintain flood insurance in accordance with applicable Federal law. [Currently, there are no regulations detailing this requirement.]
Failure to notify the transferee means that in the event the transferee fails to maintain the required flood insurance and the property is damaged by a flood disaster requiring Federal disaster relief, the transferor will be required to reimburse the Federal government.
The law is unclear as to what document(s) should contain this notice. C.A.R. Forms RPA-CA and NHD may be acceptable, but technically are not documents which "evidence the transfer of ownership." Clearly, a grant deed is such a document.
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"Federal Flood Insurance Disclosure"
42 U.S.C.
§ 5154a.
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Home Energy Ratings
12
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Transfer *16or exchange of all real property.
Also applies to Manufactured Homes (as defined in H&S § 18007, which includes personal property Mobilehomes)
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If a home energy ratings booklet to be developed by the State of California is delivered to the transferee, then a seller or broker is not required to provide additional information concerning the existence of a statewide home energy rating program.
NEITHER THIS PROGRAM NOR THE BOOKLET IS AVAILABLE AT THIS TIME.
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Cal. Civ. Code
§ 2079.10;
Cal. Pub. Res. Code
§§ 25402.9, 25942. |
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Home Environmental Hazards
13
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Transfer *17 or exchange of all real property.
Also applies to Manufactured Homes (as defined in H&S § 18007, which includes personal property Mobilehomes)
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If a consumer information booklet *18is delivered to the transferee, then a seller or broker is not required to provide additional information concerning common environmental hazards.
Although highly recommended, delivery is voluntary.
However, known hazards on the property must be disclosed to the transferee.
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Cal. Civ. Code § 2079.7. |
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Home Inspection Notice(FHA/HUD)
14
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Sale of residential real property of 1-4 units, including mobilehomes on a permanent foundation, which involve FHA loans or HUD-owned properties. |
For all properties regardless of when they were built, the borrower must sign the notice entitled, "The Importance of a Home Inspection."
C.A.R. Form HID may be used for this purpose.
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"FHA Inspection Disclosure Form "
HUD Mortgagee Letter 96-10.
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Lead Hazard Pamphlet
15
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Sale or lease of all residential property, built before 1978, except as indicated below.
Mobilehomes are also subject to this law.
Exemptions:
- foreclosure or trustee’s sale transfer (REO properties and deed in lieu of foreclosure are NOT exempt!)
- zero-bedroom dwelling (loft, efficiency unit, dorm, or studio)
- short-term rental (100 or fewer days)
- housing for elderly or handicapped (unless children live there)
- rental housing certified free of lead paint
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The seller/lessor must provide the buyer/lessee with a lead hazard information pamphlet, disclose the presence of any known lead-based paint and provide a statement signed by the buyer that the buyer has read the warning statement, has received the pamphlet, and has a 10-day opportunity to inspect before becoming obligated under the contract.
The purchaser (not lessee) is permitted a 10-day period to conduct an inspection unless the parties mutually agree upon a different time period.
The agent, on behalf of the seller/lessor, must ensure compliance with the requirements of this law.
C.A.R. pamphlet, "Protect Your Family From Lead in Your Home," and C.A.R. form FLD satisfy these requirements (except for sales of HUD properties—HUD forms required).
The C.A.R. revised home environmental hazards booklet may be used in lieu of the pamphlet mentioned above.
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"Federal Lead-Based Paint and Lead-Based Paint Hazards Disclosures"
"Federal Pre-Renovation Lead Information Rule"
Residential Lead-Based Paint Hazard Reduction Act of 1992, 42 U.S.C.S.
§ 4852d.
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Megan’s Law Disclosure
16
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Sale *19or lease/rental of all residential real property of 1-4 units (No exemptions except for never-occupied properties where a public report is required or properties exempted from a public report pursuant to Business & Professions Code
§ 11010.4) |
Every lease or rental agreement and every sales contract is required to include a statutorily-defined notice regarding the existence of public access to database information regarding sex offenders.
The following C.A.R. forms contain this statutory notice: LR, LR-S, RIPA, RPA-CA
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Cal. Civ. Code
§ 2079.10a
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Mello-Roos District or Any Other Bond Assessment
17
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Transfer *20 or exchange of residential real property of 1-4 units subject to a continuing lien securing the levy of special taxes pursuant to the Mello-Roos Community Facilities Act.
Same exemptions as for the Transfer Disclosure Statement except that new subdivisions are not exempt.
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The transferor must make a good faith effort to obtain a disclosure notice concerning the special tax or assessment from each local agency that levies a special tax or assessment and deliver the
notice(s) to the prospective transferee.
Transferors may comply with this law by using a third-party disclosure company.
Transferors may comply with the bond assessment disclosure requirement by using a recent tax bill or an itmeization from a title report.
The transferee has a 3 or 5-day right of rescission.
There is no affirmative duty by an agent to discover a special tax or district or assessment not actually known to the agent.
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"Mello-Roos District Disclosure Requirements"
Cal. Civ. Code § 1102.6b; Cal. Gov't Code
§§ 53340.2, 53341.5, 53754.
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Military Ordnance Location
18
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Transfer *21or exchange of residential real property of 1-4 units and lease of any residential dwelling unit.
Same exemptions as for the Transfer Disclosure Statement.
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Disclosure is required when the transferor/lessor has actual knowledge that a former military ordnance location (military training grounds which may contain explosives) is within one mile of the property.
The transferor/lessor must disclose in writing to the transferee/lessee, that these former federal or state military ordnance locations may contain potentially explosive munitions.
The transferee has a 3 or 5-day right of rescission.
C.A.R. Form TDS may be used.
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Cal. Civ. Code
§§ 1102.15, 1940.7. |
Mold (Toxic)
(no new disclosure duties upon transfer until after the DHS establishes guidelines)
19
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Sale, lease, rental, or other transfer of any commercial, industrial or residential property |
There are no current disclosure requirements until after the Dept. of Health Services (DHS) develops permissible exposure limits for molds and a consumer booklet.
The TDS has been modified to include the word "mold" in paragraph II.C.1.
As always, any transferor must disclose actual knowledge of toxic mold on the property.
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"Mold and Its Impact on Real Estate Transactions"
Cal. Health & Safety Code §§ 26100 et seq., §§ 26140, 26141, 26147, 26148
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Seismic Hazard Zones
20
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Sale of all real property which does contain or will eventually contain a structure for human habitation and which is located in a seismic hazard zone as indicated on maps created by the California Division of Mines and Geology.
Also applies to Manufactured Homes (as defined in H&S § 18007, which includes personal property Mobilehomes)
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The seller's agent or the seller without an agent must disclose to the buyer the fact that the property is in a seismic hazard zone if maps are available at the county assessor's, county recorder's, or county planning commission office, or if the seller or seller’s agent has actual knowledge that the property is in the zone. If the map is not of sufficient accuracy or scale to determine whether the property is in the zone, then either the agent indicates "yes" that the property is in the zone or the agent may write "no" that the property is not in this zone, but then a report prepared by an expert verifying that fact must be attached toC.A.R. Form NHD.
If a TDS is required in the transaction, either C.A.R. Form NHD, "Natural Hazard Disclosure Statement" or an updated local option disclosure form must be used to make this disclosure.
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"Seismic Hazard Zone Maps Update"
"Natural Hazard Disclosure Statement"
Cal. Pub. Res. Code
§ 2690 et seq.,
§ 2694; Cal. Civ. Code § 1103
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Smoke Detector Compliance
21
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All existing dwelling units must have a smoke detector centrally located outside each sleeping area (bedroom or group of bedrooms). In addition, new construction (with a permit after August 14, 1992) must have a hard-wired smoke detector in each bedroom. Any additions, modifications, or repairs (after August 14, 1992) exceeding $1,000 for which a permit is required will also trigger the requirement of a smoke detector in each bedroom. (These may be battery operated.) |
The seller of a single family home must provide the buyer with a written statement indicating that the property is in compliance with current California law.
Same exemptions from compliance and disclosure as for the Transfer Disclosure Statement but only for single family homes and factory-built housing, not other types of dwellings. Transfers to or from any governmental entity, and transfers by a beneficiary or mortgagee after foreclosure sale or trustee's sale or transfers by deed in lieu of foreclosure, which are exempt under the TDS law, are not exempt from this law.
LOCAL LAW MAY BE MORE RESTRICTIVE! Check with the local City or County Department of Building and Safety.
C.A.R. Form SDS may be used.
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Cal. Health & Safety Code
§§ 13113.7, 13113.8, 18029.6. |
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State Responsibility Areas
(Fire Hazard Areas)
22
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Sale of any real property located in a designated state responsibility area (generally a "wildland area") where the state not local or federal govt. has the primary financial responsibility for fire prevention. The California Department of Forestry provides maps to the county assessor of each affected county. *22
Also applies to Manufactured Homes (as defined in H&S § 18007, which includes personal property Mobilehomes)
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The seller must disclose to the buyer the fact that the property is located in this zone, the risk of fire, state-imposed additional duties such as maintaining fire breaks, and the fact that the state may not provide fire protection services. The disclosure must be made if maps are available at the county assessor’s, county recorder’s or county planning commission office, or if the seller has actual knowledge that the property is in the zone. If the map is not of sufficient accuracy or scale to determine whether the property is in this Area, then either the agent indicates "yes" that the property is in this Area or the agent may write "no" that the property is not in this Area, but then a report prepared by an expert verifying that fact must be attached toC.A.R. Form NHD.
If a TDS is required in the transaction, either C.A.R. Form NHD, "Natural Hazard Disclosure Statement" or an updated local option disclosure form must be used to make this disclosure.
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"Natural Hazard Disclosure Statement"
Cal. Pub. Res. Code
§§ 4125, 4136; Cal. Civ. Code § 1103
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"Very High Fire Hazard Severity Zone"
23
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Sale of any real property.
Also applies to Manufactured Homes (as defined in H&S § 18007, which includes personal property Mobilehomes)
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The seller must disclose the fact that the property is located within this zone and whether it is subject to the requirements of Gov’t Code Section 51182 (e.g., clear brush, maintain fire breaks). The disclosure must be made if maps are available at the county assessor’s, county recorder’s or county planning commission office, or if the seller has actual knowledge that the property is in the zone. If the map is not of sufficient accuracy or scale to determine whether the property is in this zone, then either the agent indicates "yes" that the property is in this zone or the agent may write "no" that the property is not in this zone, but then a report prepared by an expert verifying that fact must be attached toC.A.R. Form NHD.
If a TDS is required in the transaction, either C.A.R. Form NHD, "Natural Hazard Disclosure Statement" or an updated local option disclosure form must be used to make this disclosure.
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"Natural Hazard Disclosure Statement"
Cal. Gov’t Code
§§ 51178, 51183.5;
Cal. Civ. Code § 1103
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Subdivided Lands Law
24
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Sale, leasing, or financing of new developments (condos, PUDs) or conversions consisting of 5 or more lots, parcels, or interests. However, a transfer of a single property to 5 or more unrelated people (unless exempt) may also trigger this law. There are exemptions too numerous to discuss in this chart. |
The owner, subdivider, or agent, prior to the execution of the purchase contract or lease, must give the buyer/lessee a copy of the final public report (FPR), preliminary public report (PPR), or the conditional public report (CPR) issued by the DRE.
No offers may be solicited until the DRE has issued one of these three reports. If the DRE has issued a CPR or PPR, then offers may be solicited, but close of escrow is contingent upon issuance of the FPR.
Contracts entered into pursuant to a PPR may be rescinded by either party; contracts entered into pursuant to a CPR are contingent upon satisfaction of certain specified conditions.
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"Subdivided Lands Law"
Cal. Bus. & Prof. Code
§ 11018.1.
Cal. Bus. & Prof. Code
§ 11018.12; Cal. Code Regs., tit. 10, § 2795.
See generally,
Cal. Bus. & Prof. Code
§§ 11000 et seq.; Cal. Code Regs., tit. 10,
§§ 2790 et seq.
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Subdivision Map Act
25
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Any division of real property into 2 or more lots or parcels for the purpose of sale, lease, or financing. There are exemptions too numerous to discuss in this chart. |
The owner/subdivider must record either a tentative and final map, or a parcel map (depending on the type of subdivision). Escrow on the transfer cannot close until the appropriate map has been recorded. |
Cal. Gov't Code §§ 66426, 66428.
See generally,
Cal. Gov't Code §§ 66410 et seq. |
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Water Heater Bracing
26
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All properties with water heaters.
Legislative intent suggests this law applies only to residential properties, but the language of the statute does not limit the requirement to residential properties.
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All owners of new or replacement water heaters and all owners of existing residential water heaters must brace, anchor or strap water heaters to resist falling or horizontal displacement due to earthquake motion.
The seller of real property must certify in writing to a prospective purchaser that he has complied with this section and applicable local code requirements.
This certification may be done in existing transactional documents, including but not limited to, the Homeowner’s Guide to Earthquake Safety, a real estate purchase contract, a transfer disclosure statement, or a local option disclosure of compliance.
C.A.R. Form WHS may be used.
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"Water Heater Bracing and Disclosure Requirements"
Cal. Health & Safety Code § 19211.
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