Requirements under Iowa Code 558A, and Chapter 14 of the Iowa Administrative Code
When is the requirement triggered?
The requirement applies to "transfers" of real estate if the property contains ONE THROUGH FOUR dwelling units.
Under what circumstances are the requirements waived?
Exemptions from the requirements are provided for: various types of court ordered transfers; foreclosures; mortgage company reacquiring property; ESTATE proceeding; guardianships; conservatorships or trusts; between joint tenants in common and spouses; separation of property in a divorce; to or from THE STATE, A POLITICAL SUBDIVISION OF THE STATE, another state, or the United States. As of 2006, Power of Attorney.
Who must fill out the form?
The seller, or their expressly authorized agent, must complete the form and the licensee must obtain a completed form signed and dated. It should be delivered to the buyer prior to an offer, and an attempt should be made to obtain the buyer's signature. An agent representing a buyer must be inform the buyer of the seller’s obligation to provide the disclosure, and if it is not delivered, must notify the buyer or their right to revoke or withdraw their offer.
Under what standard is the form required to be filled out?
The forms shall be filled out by the seller in good faith. Good faith has been defined as the " total absence of any intention to seek an unfair advantage or to defraud another party… an honest and sincere intention to fulfill one’s obligations." Also all parties to a transaction are entitled to honesty and reasonable skill in all contacts with a real estate licensee. The Iowa Real Estate Commission believes the seller disclosure form should be able to "speak for itself" with no interpretations or embellishments provided from a real estate licensee.
What information is required to be disclosed?
All the mandatory and suggested information required by the regulations are included in the standard forms provided by the Iowa Association of REALTORS®. In addition, buyers are entitled to information that may be deemed a "material adverse fact" or effect the structural integrity of the property. The form must be updated if any change occurs which make the current form inaccurate, and any report by a qualified inspector may also be attached to the disclosure.
Is there any protection from liability for the real estate salesperson or broker?
There have been no reported cases, as yet, of trials involving Chapter 558A. Code Section 558A.6 protects salesperson or brokers from liability from an error in the disclosure form unless they have "knowledge" of the inaccuracy, or fail to exercise ordinary care in obtaining the information. There have been, however, several cases of misrepresentation and fraud against real estate agents.
Will a transaction be void solely due to the failure to provide a seller disclosure statement?
Section 558A.8 states a transaction shall not be invalid solely because of a failure to comply with the disclosure chapter. A person attempting to back out of a transaction would have to claim the disclosure was material to the transaction, and they were going to rely upon the representations made.
Once I have completed the seller disclosure form am I through with required disclosures?
The real estate disclosure does not relieve other disclosure requirements, such as agency.