A Seller’s Liability for a Leaky Basement


This is a legal document that gives the prospective buyer details of the property. It is a binding document and should be completed without the help of a real estate agent or other third party. Every residential home seller in Michigan and Ohio must complete this statement.

Understanding the Disclosure Statement

There is nothing wrong with purchasing a home that has a leaky basement or damage from floods. But, if a seller fails to disclose that they knew about water problems, that is a legal problem for the seller. It is hard to determine if a seller is liable for the leaky basement after they disclosed what they thought the problem was

Good Faith Disclosure Material Defects

Material defects include roofing, heating, air conditioning, plumbing, electrical, remodeling permits, structural changes to the property, and property repair history.

Disclosure Laws

The Seller Disclosure law does not require specific investigation or inquiry into the items on the list when completing the form. The law does not require the seller to uncover items that they are not knowledgeable about. Sellers do not need the knowledge of a licensed contractor. The seller’s disclosure form is not a warranty against defects; it relates only to those material defects known to the seller.

Detailed Home Inspection

The seller gives disclosure to the buyer documenting their knowledge of the property. It’s not the same thing as an independent inspection by a third party. An examination may reveal defects that the seller may not have been aware of.

The Seller’s Disclosure Statement is not a substitute for an inspection by a licensed home inspector. The buyer should use the statement, along with a detailed home inspection report, to uncover any defects the buyer and seller are not aware of.


For sellers, when in doubt, disclose. You could face fees, costs, and emotional expense in the event of future litigation. Always consult a real estate attorney if you have any questions as a buyer or seller of real estate.

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