TDS and revocable trusts. Most sellers of residential properties are required to complete a Real Estate Transfer Disclosure (TDS) declaration. Exceptions to the SDS requirement include court-ordered sales, trustees in estate and trust management, and REO sales. One of the most confusing exceptions was fiduciaries. Trust trustees are exempt from providing an SST unless the trustee is an individual who is the “sole trustee” of a revocable trust who is the former owner of the property or who occupied the property in the previous year. The reasoning is that this person is really the “owner” of the property and knows as much about the property as any other owner and should therefore fill out a TDS. If the seller has indicated “yes” to any of the questions, he is required to explain it in the blank lines provided on the disclosure. In the last two sections of the exempt seller disclosure, buyers and sellers are encouraged to date and sign. In Section 5, the Seller signs and acknowledges, to the best of his knowledge and belief, that the information provided on the ESD is “true and accurate”. And by signing, they authorize their representation in the transaction to issue a copy of the disclosure to each potential buyer. C.A.R states that the ESD “provides for the delivery and acknowledgement of receipt of legal disclosures and contractual disclosures not provided for in the Real Estate Transfer Disclosure Statement (TDS)”.

Section 2 of the ESD is divided into two parts that examine the California laws behind this disclosure. Section 3 of the Exempt Seller Disclosure makes it clear to sellers and buyers that the following statements made in the disclosure do not originate from the agent, but from the seller. It also states that the ESD is not a warranty and does NOT replace any inspections or warranties that the buyer may wish for. It is also recommended to consult a lawyer if you wish. Disclosure of the exempt seller on a page makes it difficult to complete in our opinion. The main areas to watch out for are the section with the assessor`s parcel number and the question part in the disclosure. The appraiser`s package number (APN) tends to provide the wrong numbers and/or leave them blank. And for the questions part of the disclosure, it is important to ensure that all questions are answered accurately and that all “yes” answers are explained in detail about ESD. The ESD form provides an abbreviated disclosure to sellers who are exempt from the SDS to disclose all known facts about the property in question. The main practical implications for real estate agents will lie in the Agency`s® disclosure and confirmation process. Section 4 begins with the questionnaire portion of the disclosure. Questions A to K, eleven in total, are a series of “yes” or “no” questions that the seller may be aware of.

The topics of each question are as follows: The first is California law (Civil Code § 1102 et seq.), which states that the majority of sellers with properties containing one to four housing units are required to give potential buyers a full TDS. However, some situations exempt the seller from providing this disclosure. Even if sellers have this exception, they are still required to disclose important facts they know about ESD. Currently, the listing agent (the seller`s agent) is required to provide an agency disclosure to the seller when it accepts an advertisement, and the selling agent (usually the buyer`s agent) is required to provide the buyer with a disclosure from the agency when drafting the offer and a disclosure from the agency to the seller when the offer is submitted. While this process may have made a lot of sense in 1986, when the law first came into effect, it is one of the most common areas of confusion for real estate agents and their clients, generating many calls to the legal hotline. Section 1 of the Exempt Seller Disclosure requires that the property in question be properly identified. The document contains empty fields for the street, city, county, and the assessor`s parcel number. All these details should already be available and can be confirmed by the preliminary report on the title. by Heather | October 17, 2018 | C.A.R., Legal, TSBOR, TSMLS | 0 Comments In a very welcome clean-up, AB 1289 amends article 1102.2 of the Civil Code by deleting the word “sole”. As of January 1, 2019, paragraph 1102.2(d) reads as follows: “This exception [the TDS exception] does not apply to a sale if the trustee is an individual who is a trustee of a revocable trust and is a former owner of the property or was a resident of the property in the preceding year.” Buyers and sellers must sign and date at the end of the exempt seller`s disclosure.

ESD is used when sellers are exempt from the Transfer Disclosure Declaration (TDS). This is a rare event in many transactions. When is a seller exempt from a transfer declaration? Below are some of the situations exempt from TDS. Finally, the last section allows the buyer to confirm that it has received, read and understood the Exempt Seller`s Disclosure. Although the two new laws touch on many articles of the Civil Code and the Code of Business and Professions, they are a “clean-up” piece of legislation that clarifies and modernizes many of the definitions of real estate law as a whole. According to Article 1101.4(b) of the Second Civil Code, sellers must replace non-compliant sanitary fittings with water-saving sanitary fittings on any single-family home built before 1 January 1994. The C.A.R. standard forms will be amended for the December version to reflect the new legal requirements. From 1.

In January 2019, the agency`s process will be simplified: the exempt seller`s disclosure, also known as the “EHR,” replaces a previously available document called Additional Legal and Contractual Disclosures (Form C.A.R. SSD). Revocable trusts are a very common form of ownership for couples and generally both parties to the couple are trustees of the trust. Many appellants on the C.A.R.`s legal helpline were confused about this fallout from the TDS application. Why is a couple who both live in the property and are both trustees of the revocable trust exempt from the levy of a TDS if a single trustee is not?. .