In Part 1 we delved into the concept of “No Representation”, which allows sellers of residential property in North Carolina the leeway to essentially divulge no information about their property at all to potential buyers when filling out the disclosure statement of their property.
To put this in perspective, completion of the property disclosure form is mandatory. Providing information about the property on this aforesaid mandatory form – any information at all – is not mandatory.
In the enlightened age of the post renaissance era – about 400 years post – this almost seems like a throwback to the stone age, especially when we consider that we’re dealing with something as complex, expensive, and consequential as buying a home.
And yet, not only does the state allow it, but after my own initial incredulity, I have actually come to agree with it. Here’s why:
The first and most obvious benefit of the “No Representation” provision for a seller is the decrease in liability that it provides. For most people, this lack of voluntary transparency by a seller probably carries with it a negative connotation; that they’re hiding something.
And that may be true, and if so, a seller with devious intent would be afforded some protection. But for me, I see this more of protecting those sellers who have no intention of trying to deceive anyone at all, but who – through innocent error alone – may accidentally provide incorrect information.
Homes are complex things. Maybe a seller is truly not aware that their roof ever leaked, an addition was done without a permit, or the home had ever been flooded. But if they say it hasn’t and it turns out that it has, they could face serious legal ramifications.
“No Representation” allows sellers to avoid that risk and simply put the responsibility of discovery onto the shoulders of the buyer.
To me, that reason alone would be more than enough to justify the “No Representation” provision. But there is, I think, another benefit for sellers that goes far more to the core of our own basic humanity, which, to me at least, makes it much more important.
In short, “No Representation” relieves the seller of the temptation to lie.
Let’s face it, a home sale is a big deal. There’s a lot of money on the table, and when a lot of money is involved, people who are otherwise very honest, hardworking folks can start doing weird things as the green monster wraps its tentacles around them and starts whispering in their ear.
And it’s not just greed that can tempt sellers to lie about their property. They may be angry that they have to sell it; a divorce or job loss could be the driving factor. Or they may be dealing with grief from the death of a loved one. There could be all kinds of emotions in play, and emotions can cloud our good judgement and make us do things in the heat of the moment that we would never ordinarily do.
“No Representation” provides sellers the path that will allow them to keep their integrity intact, and I would suggest that our integrity is – or should be – far more important to us than our liability.
My mom told me a long time ago that ‘locks keep honest people honest’. In that respect, “No Representation” can be looked at as a simple metaphor for a really nice lock.
All very well if you’re a seller. But is what’s good for the goose also good for the gander? How could “No Representation” possibly be in the best interests of a buyer? The answer to that coming up next time!
Please let me know if you have any questions by calling 252-876-8267 or sending an email.
By Contribution Author, Blaine Staat, Weichert Realtors At Rivers Edge, 220 Front St., Suite A, New Bern