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Property Disclosure Statement Guide: What Landlords, Tenants, and Investors Need to Know

Learn everything about property disclosure statements, including legal requirements for sellers, what tenants should know when their rental is being sold, and how investors can protect themselves during transactions.

Introduction

A Property Disclosure Statement is a legally significant document that requires property sellers to reveal known material defects and issues with a property. Whether you're a tenant whose rental home is being sold, a landlord selling your rental property, or a real estate investor managing multiple properties, understanding disclosure requirements is crucial to protect your interests and avoid potential legal disputes. This guide explains what property disclosure statements entail, who needs to complete them, what must be disclosed, and how these documents affect different parties in real estate transactions.

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Key Things to Know

  1. 1

    Property disclosure requirements vary by state, so always check your local laws or consult with a real estate attorney to understand specific obligations in your area.

  2. 2

    Disclosure statements typically cover known issues only—sellers generally aren't required to hire inspectors to discover unknown problems.

  3. 3

    For landlords selling rental properties, tenant-reported maintenance issues should be included in your disclosures, even if you haven't personally verified them.

  4. 4

    Tenants' lease rights are generally protected when a rental property is sold; the new owner typically must honor existing lease terms.

  5. 5

    Real estate investors should maintain detailed property records and consider pre-listing inspections to facilitate accurate disclosures.

  6. 6

    Selling a property 'as-is' does not exempt sellers from disclosure requirements—you must still disclose known material defects.

  7. 7

    The consequences of inadequate disclosure can include lawsuits, monetary damages, rescission of the sale, and significant legal expenses.

  8. 8

    When in doubt about whether to disclose something, the safer legal approach is to include it in your disclosure statement.

Key decisions before you file

Before you file a Property Disclosure Statement in Nebraska, a few decisions shape the document: which option to choose and what each one means. The Property Disclosure Statement guide walks through them.

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Nebraska Requirements for Property Disclosure Statement

  • Nebraska Real Estate Seller Disclosure Act (Neb. Rev. Stat. §§ 76-2,120)

    Requires sellers to provide written disclosure of known material defects in the property. This is the primary Nebraska law governing property disclosures and establishes the framework for what must be disclosed to potential buyers.

  • Lead-Based Paint Disclosure (42 U.S.C. § 4852d; 24 CFR Part 35; 40 CFR Part 745)

    Federal law requiring disclosure of known lead-based paint and lead-based paint hazards in housing built before 1978. Sellers must provide buyers with an EPA-approved information pamphlet and any known information concerning lead-based paint.

  • Megan's Law Disclosure (Neb. Rev. Stat. §§ 29-4001 to 29-4014)

    While Nebraska doesn't specifically require sellers to disclose the presence of registered sex offenders in the neighborhood, federal case law has established that material facts that could affect property value should be disclosed.

  • Flood Zone Disclosure (Neb. Rev. Stat. § 76-2,120(4))

    Nebraska law requires disclosure of whether the property is located in a flood zone or floodplain, and whether the seller maintains flood insurance.

  • Environmental Hazards Disclosure (Neb. Rev. Stat. § 76-2,120)

    Sellers must disclose known environmental hazards on the property, including radon, asbestos, and other toxic substances that could affect health or safety.

  • Water Damage and Mold Disclosure (Neb. Rev. Stat. § 76-2,120)

    Nebraska law requires disclosure of known water intrusion issues, flooding, water damage, and mold problems that could affect the property's value or habitability.

  • Structural Defects Disclosure (Neb. Rev. Stat. § 76-2,120)

    Sellers must disclose known structural issues, including foundation problems, roof defects, and other material structural concerns that could affect the property's integrity.

  • Homeowners Association Disclosure (Neb. Rev. Stat. § 76-2,120)

    Sellers must disclose if the property is subject to homeowners association governance, including information about dues, special assessments, and restrictions.

  • Methamphetamine Production Disclosure (Neb. Rev. Stat. § 76-2,120)

    Nebraska law requires disclosure if the property was used for methamphetamine production, as this can create hazardous chemical residues that pose health risks.

  • Stigmatized Property Disclosure (Neb. Rev. Stat. § 76-2,120)

    Nebraska law does not specifically require disclosure of deaths, crimes, or other stigmatizing events on a property, but material facts that could affect property value should generally be disclosed.

  • Utility and Mechanical Systems Disclosure (Neb. Rev. Stat. § 76-2,120)

    Sellers must disclose known defects in electrical, plumbing, heating, cooling, and other mechanical systems of the property.

  • Boundary Dispute Disclosure (Neb. Rev. Stat. § 76-2,120)

    Nebraska law requires disclosure of known boundary disputes, encroachments, or easement issues affecting the property.

  • Zoning and Land Use Disclosure (Neb. Rev. Stat. § 76-2,120)

    Sellers must disclose known zoning violations or non-conforming uses of the property that could affect its value or future use.

  • Material Defects Disclosure (15 U.S.C. § 1701 et seq.)

    Federal case law under the Interstate Land Sales Full Disclosure Act requires disclosure of material facts that could significantly affect the value or desirability of the property.

  • Radon Gas Disclosure (EPA Indoor Radon Abatement Act; Neb. Rev. Stat. § 76-2,120)

    While not specifically mandated in Nebraska statutes, EPA guidelines and general disclosure principles require sellers to disclose known radon issues, which is a common concern in Nebraska.

  • Well and Septic System Disclosure (Neb. Rev. Stat. § 76-2,120)

    Nebraska law requires disclosure of private water systems, including wells, and private waste disposal systems such as septic tanks, including any known defects.

  • Previous Insurance Claims Disclosure (Neb. Rev. Stat. § 76-2,120)

    Sellers should disclose significant insurance claims related to the property, particularly those involving water damage, fire, or other structural issues.

  • Termite and Wood-Destroying Organism Disclosure (Neb. Rev. Stat. § 76-2,120)

    Nebraska law requires disclosure of known termite infestations or damage, as well as other wood-destroying organisms that could affect the property's structural integrity.

  • Seller's Liability for Misrepresentation (Neb. Rev. Stat. § 76-2,120(12))

    Nebraska law establishes liability for sellers who knowingly misrepresent or fail to disclose material defects, allowing buyers to seek damages for such misrepresentations.

  • Exemptions from Disclosure Requirements (Neb. Rev. Stat. § 76-2,120(6))

    Nebraska law provides certain exemptions from disclosure requirements, such as for transfers pursuant to court order, between co-owners, or to a spouse or certain relatives.

Frequently Asked Questions