Trading Half a Loaf For a Full One (or Possibly None)
Starting this January 1, something happened to the Minnesota Seller’s Disclosure that I’d never seen before: it got shorter*.
Lopped off the end of the document: the section requiring Sellers to sign (again) as of the date of the Purchase Agreement (“PA”), representing either that there was no change in their home’s condition since they listed it, or, specifying what those changes were.
Ongoing Duty
The problem with the updated disclosure was that it erroneously gave at least some Sellers the notion that that effectively ended their duty to update.
In fact, Sellers are obliged to keep their Disclosure current through closing, which can follow the PA signing by as much as 8-10 weeks.
That’s plenty of time (at least in Minnesota) for wet basements, hail damage, and other horribles to occur (hopefully, insured).
Theory vs. Practice
In the wake of the change, Sellers are obliged to complete a separate Amendment if there has been a material change in their home’s condition once it’s under contract, but before closing (it’s conceivable that multiple amendments will be required if more than one event occurs).
In theory, the change will result in more complete and updated Seller disclosure.
In practice, my concern is that some poorly-advised Sellers — without the prompt at the end of the old Seller’s Disclosure — will neglect to update their Disclosure at all.
*At least, part of it did; a new section on radon was added to the end.
