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Utah Real Estate Commission Versions (2)
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Buyer Beware (Caveat Emptor)
Utah is a “Buyer Beware” state, meaning the buyer is generally responsible for conducting inspections and discovering defects before closing. In the absence of a contractual agreement to the contrary, sellers are protected from executing or disclosing the following:
- Duty to Investigate: Sellers have no duty to proactively investigate unknown flaws or point out obvious, visible defects before completing disclosure forms (Mitchell v. Christensen (2001).
- Non-Material Facts: Sellers do not have to volunteer non-material, psychological stigmas like a past crime or suicide on the property (§ 57-1-37).
- Right to Silence: A seller is not obligated to disclose everything they know about a property’s general wear and tear and may remain silent about any defect discoverable by the buyer (Mitchell v. Christensen (2001).
Exceptions:
- Fraudulent Concealment: A seller forfeits all protections if they knowingly deceive a buyer or fail to disclose a known, material defect that is hidden from plain view (Mitchell v. Christensen (2001).
- Methamphetamine Contamination: A seller must disclose actual knowledge of methamphetamine contamination; the only way a seller retains protection without disclosing is if the property has been professionally decontaminated and certified by the local health department (§ 57-27-201)
- New Construction: Buyers of brand-new homes are protected against substandard building practices. Homebuilders in Utah are legally bound by an implied warranty of habitability and workmanlike construction that cannot be overridden by contract text (Homeowners Ass’n v. Pilgrims Landing LC (2009)).
- Real Estate Agents: Licensed real estate professionals cannot hide behind a seller’s right to silence or lack of knowledge. Agents are independently required by state licensing laws to disclose all known material facts and adverse physical conditions to the buyer (§ 61-2f-401).
Required Disclosures (8)
1.) FHA/VA Loan Addendum: This document is mandatory when a buyer uses government-backed financing (§ 36.4303). It includes a federally-required “Escape Clause” that protects the buyer’s earnest money if the home does not appraise at the purchase price (§ 203.255).
2.) HOA Governing Documents: If the property being sold is part of a Homeowners Association, the seller must provide the buyer with a complete copy of the association’s recorded governing documents, such as CC&Rs and bylaws, before closing (§ 57-8a-105.1).
3.) HOA Ombudsman Notice: Sellers of properties in a Homeowners Association must provide a notice and link to the state’s HOA Ombudsman website to inform buyers of their rights and advisory resources.
4.) Lead-Based Paint Disclosure: Owners of homes built before 1978 must disclose any known lead-based paint hazards and provide an EPA-approved informational pamphlet to the buyer (42 U.S. Code § 4852d).
5.) Methamphetamine Disclosure: Sellers must notify buyers if they have actual knowledge that the property is currently contaminated by methamphetamine production or storage (§ 57-27-201). This disclosure is included in Utah’s mandatory Seller’s Property Condition Form.
6.) Secondary Water Metering: This form identifies if the property uses pressurized secondary irrigation water and provides mandatory instructions to the closing agent for transfer reporting (§ 73-10-34).
7.) Seller’s Property Condition: This is the primary document where the seller lists all known material defects affecting the property’s physical condition, fulfilling the contractual duty for a written statement (Mitchell v. Christensen (2001).
8.) Solar Panel Status: If there are solar panels on the property being sold, the seller must disclose whether the solar system is owned, leased, or financed, and ensure the buyer understands the financial obligations and warranties associated with the equipment.
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