Aloha. George Krischke here with Honolulu HI 5 (company now called Hawaii Living).
Today, we’re going to talk about the Seller’s Disclosure Statement. In Hawaii, sellers are obligated to complete the Seller’s Real Property Disclosure Statement (SRPDS). It is a questionnaire that is pre-printed, and the seller has to complete and answer all the questions on there. And the seller has to complete it to the best of his knowledge and must fully and accurately disclose all material facts relating to the property for sale.
Material facts, well what does it mean? Material facts means any fact, condition, or defect, past or present. Let me say it again: any fact, condition or defect, past or present, that could measurably affect the value of the property for sale to a reasonable person. That’s the law. Sellers should not take this lightly. We strongly recommend for sellers to be as detailed and thorough as possible in completing the disclosure.
It’s also important because it’s a way to minimize the risk for potential complaints afterwards. That’s good practice. Now the seller is obligated to amend the disclosure if something happens after the disclosure statement was provided to the buyer. And then the buyer has, again another review and approval time period.
The review period for the buyer to review the seller’s disclosure statement, as well as the amended disclosure, is often between, well, maybe as short as five days, sometimes ten days, sometimes as long as fifteen days, but often between five and ten days.
Now, if the buyer is not satisfied with the disclosure or with the amended disclosure, the buyer may cancel the contract. However, the cancellation needs to be in writing, and it needs to be within the specified time period per the contract, maybe between five and ten days, depending on how the contract is written. And if the buyer fails to cancel within that specified time period, he will have waived his right to cancel the contract based on this contingency.
And that’s it for today. Thanks for watching. ~Aloha.