There are many details to consider when buying or selling a home. Among them are two dangerous substances that may lurk in your home or a home you plan to buy: lead-based paint and radon gas. The following briefly summaries these issues and explains the seller’s duty to disclose these and other potential problems.
Although the sale of lead-based paint has been banned nationwide since 1978, lead poisoning is still said to be the number one threat to the health of children in the United States. Dust and tiny pieces from peeling or chipping lead-based paint can be dangerous if ingested by children or pregnant women. The long-term effects of elevated levels of lead in a child may include learning disabilities, decreased growth, hyperactivity, impaired hearing, and even brain damage.
Regulations to implement the Federal Residential Lead-Based Paint Hazard Reduction Act were issued by the U.S. Environmental Protection Agency (EPA) and the Department of Housing and Urban Development in March of 1996. The purpose of these regulations is to ensure that families are aware of the hazards of exposure to lead-based paint and to inform them of ways to avoid such exposure before becoming obligated to purchase or lease housing that may contain lead-based paint.
Under the regulations, sellers and lessors of most residential housing built before 1978 must attach a standard disclosure and acknowledgment form to all sales contracts and leases stating whether they are aware of any lead-based paint hazards. Sellers and lessors must also provide purchasers and lessees with the EPA pamphlet, Protect Your Family from Lead in Your Home, before completing the contract or lease. Purchasers and lessees will have ten days to conduct an inspection or risk assessment for the presence of lead-based paint before they will be obligated under a contract or lease.
A seller or lessor found to be in violation of the regulations will be subject to Federal criminal penalties of up to one year in prison, civil penalties of up to $10,000 per violation, and triple damages to a purchaser or tenant who brings a successful private suit for damages from lead-based paint in the residence.
Radon is a colorless, odorless, radioactive gas produced by the natural decay of the elements radium and uranium contained in the soil. Radon is the only naturally occurring radioactive element that is a gas. Radon may enter a house through cracks in the foundation or floor slab, drainage titles to the sumps, and even well water. The gas itself is not dangerous, however, it decays into elements, called radon progeny, which attach to solid particles such as dust. When inhaled, radon progeny decay, releasing alpha particles that destroy sensitive lung tissue. Radon exposure has no immediate symptoms, but long-term exposure to high levels increases the risk of lung cancer.
The only way to determine the radon concentration in any house is to measure it. Anyone who can read and follow directions can collect radon measurements with a monitor, which must be sent to a laboratory for reading by trained individuals.
Seller’s Duty to Disclose
The Residential Real Property Disclosure Act requires residential property sellers to give prospective buyers a written disclosure document regarding the physical condition of the property before any contract for sale is signed. The act encompasses transfers by sale, installment contract, assignment of beneficial interest, or lease with option to purchase. It does not apply to transfers of new (residential) construction that has not been occupied, or to transfers by deed in lieu of foreclosure, by inheritance, pursuant to certain court orders, or between spouses, descendants, and co-owners.
The Act benefits buyers, sellers, and real estate agents by reducing the number of oral representations made about the property and promoting faster settlement of claims. The law provides a standardized form for the required disclosures. The form, Residential Real Property Disclosure Report, contains twentysome questions about the property, including questions about material defects, structural defects, and the presence of lead-based paint and radon gas.
Using the form as a guide, sellers are required to disclose “material defects” of which they have actual knowledge. Material defects are conditions that adversely affect the property’s value or the health and safety of the occupants. Sellers are not required to investigate for defects or to amend the disclosure document after it has been delivered to the prospective buyer unless it contains errors, inaccuracies, or omissions they had knowledge of at the time the document was signed. Sellers are not liable for a defect they had no knowledge of or reasonably believed was corrected, nor are sellers liable for errors, inaccuracies, or omissions in information provided by contractors (such as a structural engineer or pest control inspector) or about matters within the scope of the contractor’s expertise.
Full compliance with the Act will not fully insulate the seller from all risks of nondisclosure. The required disclosure does not do any of the following:
provide a warranty of the condition of the property.
substitute for any warranties the buyer might wish to negotiate with the seller;
replace a property inspection by the buyer; or
limit or modify any disclosure obligation created by other statutes or the common law in order to avoid fraud, misrepresentation, or deceit in the transaction.
Seller’s must complete and deliver the disclosure document to the buyer. A seller who violates the Act will be liable for the actual damages and court costs. The court may also award reasonable attorney’s fees to the prevailing party.
Disclosing Underground Storage Tanks
Do you own or intend to buy property that contains an underground storage tank? The Illinois Responsible Property Transfer Act (IRPTA) requires a seller to make written disclosure of existing and potential environmental liabilities prior to conveying an ownership or collateral interest in property. This disclosure document must be recorded with the county recorder and the Illinois Environmental Protection Agency within 30 days of transferring the property. IRPTA applies to residential property with underground storage tanks unless the storage tanks are 1,100 gallons or less and used at a personal residence to store motor fuel for personal use. Find out whether IRPTA applies to your property.
Consult An Attorney
Whether you’re buying or selling or just thinking about it, make sure you are aware of your rights and obligations. Sellers and lessors of housing built before 1978 should consult an attorney to find out what lead-related conditions must be disclosed, how records of such disclosure should be kept, and which types of real estate transactions are excluded from coverage. Purchasers and lessees, especially those with young children should consult an attorney to advise them of their rights under the new regulations before buying or leasing residential housing that may contain lead-based paint hazards. As for radon, there are steps you can take to test your home – or the home you plan to buy – and protect yourself against its harmful effects. If you’d like to review a copy of the Residential Real Property Disclosure Report, call our offices. No matter what the circumstances, consult an attorney before you sign any kind of contract, agreement, or disclosure.