We recently had a property that was being sold By Owner and in an Estate. The sellers inspection observed suspect mold, well the seller said it was dirt.
The buyer, being prudent, wanted the area tested and 100% mold was present. The buyer upon finding mold, needed a professional assessment of the mold to find the cause and develop the cost for remediation. The seller did not want to do anything regarding the mold and the deal fell through.
New Jersey has new mold disclosure requirements that place the responsibility of the owner (seller) to disclose if mold is present and to reference it on the required home disclosure statement. The law unfortunately requires the owner to be ethical and diligent in knowing if mold is present. Finding mold typically occurs when a buyer does their due diligence and finds mold. In a usual real estate transaction, finding mold becomes somewhat of public knowledge, as the parties in the transaction, owner, buyer, their realtors, their attorneys, and their inspectors will all know about the mold. This doesn’t even take into account other real estate professionals in the respective real estate office who will inquiring regarding how the transaction is going. Mold can be a deal killer, from the viewpoint of either side (buyer or seller). The deal killer aspect is concern that the home is uninhabitable (99.99% of the time the mold is 100% fixable making this concern mute). The seller not wanting to address the mold, well which can be a deal killer but also triggers the responsibility of the seller to update their disclosure statement to future buyers. The rub is many sellers do not want to disclose that mold is present, and the most common parties are properties that are For Sale by Owner and homes that are in an Estate. These transaction have the seller believing they do not have to comply with disclosure requires or unaware of successful lawsuits against sellers for not disclosing conditions that can make the home uninhabitable such as mold.
What is the takeaway from mold in real estate transactions?
Include a professional mold inspection as part of your due diligence. Let the seller side know you are performing a mold inspection. If the seller refuses to allow the inspection, the home is likely not for you.