If you are unsure if your client needs to fill out a Residential Property Disclosure, please go to the Resources folder in the dotloop templates section and review the "Residential Property Disclosure - when is it needed?" document.
According to state law, sellers (including investors) are required to complete the Residential Property Disclosure form. Here is a link to the Ohio Code http://codes.ohio.gov/orc/5302.30. Please review paragraphs (C), (K)(2), and (K)(3).
According to this law, if a seller does not complete a Residential Property Disclosure, the buyer may cancel the transaction at the earliest of:
- Within 3 business days of receiving the completed Residential Property Disclosure
- Prior to closing
- 30 days after acceptance of the offer
Another question often asked is, "If an investor (flipper) draws a line through the pages of the disclosure and writes on the form that he has not lived there, is this legal/valid". I have contacted the OAR legal hotline regarding this and they said there isn't any case law on this but it could be argued that the seller has not provided a "completed" disclosure as required by this law and therefore the purchaser could possibly terminate the purchase agreement up to 30 days after acceptance, with no legal recourse for the seller.
Paragraph (C) Except as provided in division (B)(2) of this section and subject to divisions (E) and (F) of this section, every person who intends to transfer any residential real property on or after July 1, 1993, by sale, land installment contract, lease with option to purchase, exchange, or lease for a term of ninety-nine years and renewable forever shall complete all applicable items in a property disclosure form prescribed under division (D) of this section and shall deliver in accordance with division (I) of this section a signed and dated copy of the completed form to each prospective transferee or prospective transferee's agent as soon as is practicable.
I hope you find this information useful. Please contact me if you have any additional questions.
OHIO CODE 5302.30
Paragraph (K)(2) Subject to division (K)(3)(c) of this section, if a transferee of residential real property that is subject to this section receives a property disclosure form or an amendment of that form as described in division (G) of this section after the transferee has entered into a transfer agreement with respect to the property, the transferee, after receipt of the form or amendment, may rescind the transfer agreement in a written, signed, and dated document that is delivered to the transferor or the transferor's agent or subagent in accordance with divisions (K)(3)(a) and (b) of this section, without incurring any legal liability to the transferor because of the rescission, including, but not limited to, a civil action for specific performance of the transfer agreement. Upon the rescission of the transfer agreement, the transferee is entitled to the return of, and the transferor shall return, any deposits made by the transferee in connection with the proposed transfer of the residential real property.
(a) Subject to division (K)(3)(b) of this section, a rescission of a transfer agreement under division (K)(2) of this section only may occur if the transferee's written, signed, and dated document of rescission is delivered to the transferor or the transferor's agent or subagent within three business days following the date on which the transferee or the transferee's agent receives the property disclosure form prescribed under division (D) of this section or the amendment of that form as described in division (G) of this section.
(b) A transferee may not rescind a transfer agreement under division (K)(2) of this section unless the transferee rescinds the transfer agreement by the earlier of the date that is thirty days after the date upon which the transferor accepted the transferee's transfer offer or the date of the closing of the transfer of the residential real property.