You have spent hours researching, touring and planning for the purchase or sale of your home, and an offer has finally been made and accepted! This is the start of an exciting time of change for you and your family! However, with such a large transaction about to take place, it is important for you to know your rights.
Though there is no law in Montana that requires your seller to disclose all known defects to the property, or that you, as a seller, disclose the defects in your home, there are safety measures in place for real estate transactions. The use of a licensed real estate agent is one measure currently in place, and most Montana real estate agents, brokers and brokerages are members of the National Association of REALTORS ®. It is your agent’s responsibility to act in your best interest, no matter if you are the buyer or seller of a property. It is also his or her job to act with you in good faith and disclose any and all information given throughout the process and transaction.
Montana law requires that “A seller agent is obligated to the buyer to … disclose to a buyer or the buyer agent any adverse material facts that concern the property and that are known to the seller agent…” The law defines an “adverse material fact” as a “fact that should be recognized by a broker or salesperson as being of enough significance as to affect a person’s decision to enter into a contract to buy or sell real property and may be a fact that…materially affects the value, affects structural integrity, or presents a documented health risk to occupants of the property.” This means the agent must tell you about any significant issue with the property about which he or she is aware.
Before the title of the home is transferred from seller to buyer, a title company or real estate lawyer should conduct a search of public records to ensure there is nothing attached to the title which might impede the transfer. Such attachments could be a lien or an easement issue which may hold up the time it takes to complete the transaction. A lien is when someone claims an interest in the property, possibly due to an outstanding debt or judgment against the seller. An easement is when someone (say, Flathead Electric Company) has the right to cross or otherwise use part of your land for a specific purpose (a power pole on your property). In the last example, Flathead Electric Company will always have their power pole on that section land, no matter the homeowner and no matter how many times the title changes hands.
This is a great time to remind you and your realtor, that when drafting an easement with the purchase of a new home, to be as specific as possible. The more specific you are from the get-go, the less likely it is that there will be a dispute in later years. The easement should also be drafted with the scope clearly defined, meaning the easement is defined by its purpose and the easement holder can make only such use of an easement, as is reasonably necessary to accomplish the purpose for which the easement is granted.
Purchasing title insurance is your protection against possible loss, if an issue was overlooked during a title search.