Property Disclosure

Disclosure questions test a specific, practical skill: knowing what a seller actually has to tell a buyer, and what happens when they don't.

The Seller's Disclosure Notice

Texas generally requires a seller to complete a Seller's Disclosure Notice covering known conditions and defects — flooding history, structural issues, past repairs, and more. This is a disclosure of what the seller knows, not a guarantee or warranty about the property's condition; a seller isn't required to investigate or discover problems they're unaware of.

Who's exempt from the Seller's Disclosure Notice

Not every sale requires it. Common recognized exemptions generally include: transfers to a co-owner or between spouses as part of a divorce, transfers by a trustee in bankruptcy, transfers resulting from a foreclosure or a deed in lieu of foreclosure, transfers to or from a government entity, and sales of new construction that has never been occupied. The exemptions are specific enough that "is this required" is genuinely worth checking against the actual list rather than assuming a Seller's Disclosure Notice is always mandatory — the exam tests exactly this gap between the general rule and its real exceptions.

The federal lead-based paint overlay

Separate from Texas's own disclosure notice, federal law layers on an additional requirement for housing built before 1978: known lead-based paint hazards must be disclosed, and this requirement applies to a lease as well as a sale — not sales alone. In practice this generally means providing a specific EPA-approved pamphlet on lead-based paint hazards, disclosing any known lead-based paint or hazards in the property, and giving the buyer a defined window (commonly framed as 10 days, though it's negotiable) to conduct a lead-based paint inspection or risk assessment before being bound to the contract.

What disclosure doesn't cover

Disclosure obligations generally don't require a seller to hire an inspector or proactively investigate problems that aren't already within their actual knowledge. That gap is exactly why a buyer's own inspection contingency matters — disclosure and inspection are two different protections, not substitutes for each other.