Key Takeaways
- Michigan requires sellers to provide a Seller Disclosure Statement for most residential transactions
- The disclosure covers known defects, conditions, and material facts about the property
- Sellers must update disclosures if conditions change before closing
- Buyers have a right to terminate within a specified period after receiving disclosure
- Certain transactions are exempt from disclosure requirements (foreclosures, estates, etc.)
Michigan Seller Disclosure Requirements
Michigan law requires sellers to provide disclosure of known property conditions in most residential transactions.
Seller Disclosure Statement
Michigan requires a Seller Disclosure Statement for most residential real estate transactions involving 1-4 units.
What Must Be Disclosed
| Category | Items Covered |
|---|---|
| Structural | Foundation, roof, walls, floors |
| Systems | HVAC, plumbing, electrical, well, septic |
| Environmental | Flood zone, underground tanks, contamination |
| Legal | Liens, encroachments, easements, assessments |
| Physical Defects | Water damage, mold, pests, leaks |
| Boundaries | Survey issues, encroachments |
Disclosure Timing
- Seller should provide disclosure before or at the time of offer
- Buyer has right to review before making decision
- Buyer may have termination rights after receiving disclosure
Updating Disclosures
If conditions change after initial disclosure but before closing:
- Seller must update the disclosure
- Material changes must be communicated to buyer
- Buyer may have new rights based on changes
Key Point: Disclosure is of known conditions. Sellers are not required to investigate or discover unknown defects.
Exemptions from Disclosure
Certain transactions are exempt from the seller disclosure requirement:
| Exemption | Description |
|---|---|
| Foreclosures | Bank-owned or foreclosure sales |
| Estate sales | Sales by personal representatives |
| Court-ordered sales | Bankruptcy, judicial sales |
| New construction | Sales by builders (warranty applies) |
| Transfers between family | Certain family transfers |
| Government sales | Sales by government entities |
Agent Responsibilities
Even when seller disclosure is exempt, agents must:
- Disclose known material facts
- Not misrepresent property conditions
- Answer questions honestly
- Recommend professional inspections
Federal Disclosure Requirements
Regardless of Michigan law, federal requirements apply:
Lead-Based Paint Disclosure (Pre-1978 Homes)
| Requirement | Description |
|---|---|
| EPA pamphlet | "Protect Your Family From Lead in Your Home" |
| Known hazards | Disclose any known lead-based paint |
| Records | Provide any lead test results |
| 10-day inspection | Buyer's right (can be waived) |
| Signatures | Both parties must sign disclosure |
Consequences of Non-Disclosure
Failure to provide required disclosures can result in:
- Buyer termination rights
- Liability for damages
- Civil penalties
- License discipline for agents
What Sellers Don't Have to Disclose
Michigan law generally does not require disclosure of:
| Category | Examples |
|---|---|
| Deaths | Deaths on the property |
| Crimes | Crimes that occurred on property |
| Health history | Prior occupant health conditions |
| Stigmatized property | Perceived paranormal activity |
Best Practice: While not legally required, sellers should consult with their agent about what to disclose. Honest disclosure reduces liability.
Which residential transactions typically require a Seller Disclosure Statement in Michigan?
For homes built before 1978, what federal disclosure is required?