Which disclosure forms should I provide to buyer when selling a multi-unit apartment?

In Selling Property - Asked by Hannah P. - Jun 21, 2013
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Answer(s)

Michael C.
Broker/Agent
San Leandro, CA

Hi Hannah, Are You The Seller or The Sellers Agent?
Is it 1-4 units or more than 4 units?
Current Leases and Tenant Estoppels for each Tenant. Tenant Concessions Like On Site Part Time or Full Time Property Manager.
Financial Statements like Income & Expense, Cash Flow, Rent Roll, Rent Receivables, etc. At least 1 year but 2-3 years or more is better. Who Pays for What Utilities?
Personal Property Like Stoves, Refrigerators, Laundry, etc Who Owns Them?
Parking- If any, how many spaces?
Inspections: Property, Roof, Pest, Title Insurance (these can be obtained by the buyer)
If you Have a Recent Appraisal.
Current Business Licenses.Current Insurance, Zoning Compliance. State Geological Report, "Natural Hazard Disclosure" Statement and Government Booklets as required-The Geological Company can usually let you know which ones apply.
This Is Not A Complete List, There Are Additional Disclosures That A Seller Must Make.
Consider Professional Assistance for Further Guidance.

Jun 22, 2013
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joe d.
Broker/Agent
Mason, OH

The short answer is you should provide the required ones.
The real world answer is you should discuss this with a real estate attorney and/or broker in your local market that is familiar with multi family properties. The age of the property, past and current financing, and a number of other factors can combine with local, state, and national disclosure laws to create any number of different answers to this question. The penalties for doing this incorrectly can be stiff, so it is much better to consult with qualified individuals to make sure you do it correctly.

Jun 26, 2013
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Joe L.
Broker/Agent
Dallas, TX

It depends upon the deal size (4 units often has different requirements). Whatever you provide in terms of financial disclosures (P&Ls, rent rolls, etc) are usually stipulated in the contract. Provide what you've agreed to provide for his due diligence. Property condition disclosures are required for some deals (2 units = optional IN TEXAS).
Probably the most common one is actually required by EPA. It's the lead paint disclosure notice for properties built before 1978. There's something like a $10,000 fine for not submitting that.

Jun 5, 2014
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Joe L.
Broker/Agent
Dallas, TX

My answer above was munged by the computer system because it doesn't understand "greater than" or "less than" symbols. Duplexes and SFRs have required condition disclosures. Greater than 2 units has optional disclosure forms.

Jun 5, 2014
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