Imagine heading toward closing only to find out the home has hidden damages, such as large holes in the walls that were hidden behind pictures, bright pink stains in the carpet that were covered by furniture and tears in the linoleum that were hidden by decorating accents. Unfortunately, this scenario takes place, and even though a buyer may purchase a home inspection, if damages are hidden under or behind objects such as plants, pictures or furniture, they become the buyers’ responsibility if repairs are not written into the purchase agreement.

The sellers’ disclosure form primarily covers the appliances, water, electrical and structural integrity of the home; however, if there are damages the seller is aware of, such as large holes in walls, then they are the liable party to disclose that information. Failure to do so could result in the seller not selling the home and possibly facing a lawsuit for negligence and fraud.

How’s a buyer supposed to find hidden damages? In the purchase agreement, a buyer can require that the home pass a final walk through prior to closing, and if during that time damages are discovered, such as torn carpet, then the seller is responsible for repairs. Because a walk through takes place right before closing, the seller will likely offer an allowance for repairs, but if that is an unsuitable solution, the buyer has the option to push the closing back so repairs are made before the deal is finalized.

While offering an allowance or scheduling repairs before closing are ideal solutions, this doesn’t always happen. In some cases, the seller may claim they didn’t know about the damage or simply refuse any type of compensation. If that’s the case, buyers have three options. One, move forward with the sale and accept the home as-is. Two, try and negotiate one more time for concessions. Three, walk away from the deal, but make sure the purchase agreement is clear that if the final walk through uncovers any damages, the buyer can back out from the sale.

Honesty is the best policy for all parties involved in a real estate transaction. Being upfront about damages or defects, can save the sellers’ from the headache of a potential lawsuit and not selling the home for the desired price, and the buyer can have peace of mind that they’re fully aware of the property’s condition prior to closing.