When evaluating any type of real estate purchase, from a smaller single-family rental house to a multi-unit apartment building, it’s incumbent upon the seller to provide you a list of any known issues with the property. Regardless of the home’s current condition the seller must disclose any known defects.

The real estate agent listing the home for the owner will review this list as well as also looking for any other potential problems. Depending upon where the property is located, discovering a defect after the purchase has closed can mean a lawsuit up to three times the amount of the repair for anything the owner knows or “should have known” about the problem, holding the owner of the property liable.

If the property needs some major work and is currently in such a state a bank won’t place a traditional loan on the unit until the issues are fixed it still doesn’t matter- a full property disclosure is required. But even though the owner did in fact perform a good faith accounting for all known issues there still can be others, seen or unseen. The owner isn’t necessarily responsible for disclosing all issues if the owner wasn’t aware of them as long as a complete assessment was performed.

That’s why property inspections are so important. A property inspector will look for things a homeowner won’t be able to discover either because the owner didn’t know to look or couldn’t access the location to view any possible structural problems. Or, a licensed expert might be the only person to identify an issue with the HVAC system. For example, would a property owner know to crawl the attic and inspect the insulation around the ductwork to see if it was in fact up to current code? Of course not, but that’s why a property inspection is not only recommended but almost a requirement. Just because a bank may not require a property inspection doesn’t mean it’s not needed. It is. Whether the property is located in Chicago or not.  Real estate is too expensive of an investment to leave it to an owner to disclose all known and unknown problems.