State of
California
Department of Real Estate
Disclosures
in
Real
Property
Transactions
Sixth
Edition
2005
ARNOLD SCHWARZENEGGER
Governor
State of California
DALE BONNER
Secretary
Business, Transportation and Housing Agency
JEFF DAVI
Commissioner
Department of Real Estate
2005
booklet was revised pursuant to a consulting contract with Wallace, Puccio &
Garrett; Principal Author and Editor – S. Guy
Puccio.
Preface
The California Department of Real Estate has published this booklet in response to an apparent need for information concerning disclosures required in real property transactions. This booklet is limited to the most common disclosures required by statute and does not include disclosures required by agreement between the principals (buyer and seller; borrower and lender; lessee and lessor, etc.).
Should you need assistance or further information, consult the statutory references included, an attorney or a knowledgeable real estate professional. Also, this booklet has a list of government agencies which you may contact for further information, as appropriate.
Because the laws concerning disclosure obligations may change, you should use this booklet only as a general source of information.
TABLE
of CONTENTS
Part I Transfer and Financing of Real Property.
Section
I Disclosures Required of a Seller
and/or a Real Estate BROKER/Agent 6
A. Disclosures Upon Transfer of Residential
Property. 6
2. Real Estate Transfer
Disclosure Statement 6
3. Local Option Real Estate
Transfer Disclosure Statement 11
4. Natural Hazards
Disclosure. 12
5. Mello-Roos Bonds and
Taxes. 15
10. Methamphetamine Contamination. 15
C. Smoke Detector Statement of
Compliance. 16
D. Disclosure Regarding Lead-Based Paint
Hazards. 16
E. California’s Environmental Hazards
Pamphlet 17
F. Delivery of Structural Pest Control
Inspection and Certification Reports. 17
G. Energy Conservation Retrofit and Thermal
Insulation Disclosures. 17
H. Foreign Investment in Real Property Tax
Act 18
K. Notice Regarding the Advisability of Title
Insurance. 19
L. Certification Regarding Water Heater’s
Security Against Earthquake. 19
M. Data Base – Locations of Registered Sex
Offenders. 19
B. Agency Relationship Disclosures. 20
C. Disclosure of the Negotiability of Real
Estate Commissions. 22
D. No Disclosure Required for Manner/Occurrence
of Death; Affliction of Occupant with Aids 22
E. Disclosure of Sales Price
Information. 22
Section
III Disclosures Required when Financing Real Property. 23
B. Seller Financing Disclosure
Statement 23
C. California Required Disclosures to
Borrowers. 24
D. California Required Disclosures to Certain
Lenders or Promissory Note Purchasers 25
1.
General Disclosure Requirements. 25
2. Multi-Lender
Transactions. 26
3. Construction Loans and
Multiple Security Properties in Multi-Lender Transactions. 26
4. Loan Servicing in
Multi-Lender and in other than Multi-Lender Transactions. 27
E. Notice of Transfer of Loan
Servicing. 27
F. Notice of Borrower’s or Lender’s Right to
Copy of Appraisal Report 28
G. Credit Terms – Truth-in-Lending and
Regulation Z. 28
H. High Cost Loans (Federal) 30
I. California High Cost Mortgage/Loan
Disclosures. 30
J. Real Estate Settlement Procedures Act
(RESPA) 31
K. Advance Disclosures in Loan Transactions
Subject to TILA and RESPA. 32
L. Disclosure by Agent Receiving Compensation
from a Lender 32
M. Adjustable Rate Loan Disclosure. 32
N. Equal Credit Opportunity Act – Notice of
Adverse Action – Regulation B. 33
O. Certain Obligations of Consumer Credit
Reporting Agencies. 33
P. Disclosure Required by the Housing Financial Discrimination Act of l977 (Holden Act) 34