Key Takeaways
- Texas Property Code Sec. 5.008 requires a written disclosure of the property\u2019s condition for most residential sales.
- The duty is to disclose what you actually know. It is not a duty to inspect or to guess.
- Some transfers are exempt, including certain estate, foreclosure and court-ordered transfers. Exempt does not mean you may mislead.
- Selling as-is does not erase the disclosure duty. As-is is about who pays for repairs, not about hiding known defects.
Two Sentences That Do Most Of The Work
Texas Property Code Section 5.008 requires the seller of most residential property to give the buyer a written notice about the property's condition. The two things worth understanding about it are simple and they pull in opposite directions.
You must disclose what you actually know. And you are not required to investigate. The notice asks about your awareness, not about the objective truth of the house. There is no duty to hire an inspector to find things you might otherwise have to reveal.
Sellers get into trouble in the gap between those sentences, in two opposite ways. Some worry they are liable for defects nobody could have known about, which is not the standard. Others convince themselves that not writing something down makes it unknown, which is exactly the standard, and they are the ones who get sued.
What The Notice Covers
The statutory form asks about the condition of systems and structure and about specific known conditions. Broadly:
- Systems and appliances: which exist and whether you know of a defect
- Structural items: roof, foundation, walls, and known previous repairs
- Water: previous flooding, water penetration, drainage, whether the property is in a flood zone or has had a flood insurance claim
- Environmental and safety: known presence of asbestos, lead-based paint, radon, underground tanks, and similar
- Legal and title matters: known encroachments, easements, unrecorded agreements, HOA obligations, pending litigation
- Termites and wood-destroying insects: known infestation or damage, and any treatment
"Do you know of" is the operative phrasing throughout. Where you genuinely do not know, saying so is the correct and honest answer. An invented reassurance is worse than an admission of ignorance, both ethically and legally.
Disclose, Repair, Or Neither
| Must you disclose? | Must you repair? | Effect on price | |
|---|---|---|---|
| A defect you know about | Yes. Known defects are material | No. Repair is negotiable | Usually lowers it, sometimes only slightly |
| A repair you already completed | Yes, and previous problems too | Already done | Often positive, especially with paperwork |
| Something you suspect but do not know | Say what you know and mark unknown honestly | No | Depends what a buyer's inspector finds |
| Something you have never had any sign of | No duty to investigate | No | None |
| A defect you conceal | This is the thing to never do | Irrelevant | Liability far exceeding any price effect |
The disclosure duty does not move. What changes is who pays for the repair. Selling as-is is about the money, never about the information.
"As-Is" Does Not Mean "Say Nothing"
This is the most consequential misunderstanding in the whole subject, and it comes up constantly in cash sales because as-is is how they are described.
As-is allocates repair responsibility. It does not license concealment. Selling as-is means the buyer accepts the property in its current condition and does not expect you to fix things. It does not mean you may withhold a known defect, and courts treat a concealed known defect very differently from an as-is sale of a disclosed one.
In practice, disclosing fully and selling as-is is the strongest position you can be in: the buyer knows what they are getting, the price reflects it, and there is nothing to argue about afterwards. That is the combination we ask for on every purchase, and it protects you more than it protects us.
Exemptions, And Why You Should Not Assume One
Section 5.008 lists transfers that are exempt from the statutory notice. The categories include certain transfers by an administrator or executor of an estate, transfers by foreclosure or deed in lieu, transfers between co-owners, some transfers between family members, and certain court-ordered transfers.
Two cautions. First, whether your transfer qualifies is a legal conclusion about your facts, so confirm it with a Texas attorney rather than reading a list and deciding. Second, and more important: exempt from the statutory form is not permission to mislead. General law about misrepresentation and fraud does not switch off because a particular form was not required. If you know something material, say it.
Estate sales are the common case here, and selling an inherited house in Texas covers them. Note the practical wrinkle: an executor who never lived in the house genuinely may not know its condition, and "unknown" is then the truthful answer to most questions.
Flooding Deserves Its Own Paragraph
Texas strengthened its flood-related disclosure requirements after repeated major flood events, and the notice asks specifically about previous flooding, water penetration, flood insurance claims and whether the property sits in a flood-prone area.
Do not be tempted to shade this one. Flood history is discoverable from claim records, neighbors and public data, so concealment is both wrong and unlikely to work. It is also less damaging to your sale than people fear, because the buyers who transact on flood-affected property are usually paying cash and already know what they are buying. Selling after a fire or flood claim covers those sales, and Beaumont, TX is the market where this comes up most for us.
How To Fill It In Well
- Do it yourself, from memory, before anyone pressures you. It is your knowledge the form asks about, and rushing it at the closing table is how mistakes happen.
- Use "unknown" where it is true, and do not use it where it is not.
- Attach paperwork for repairs. An invoice and a warranty turn a disclosed defect into a disclosed and solved defect, which reads completely differently.
- Add a note where the boxes do not fit. If the answer needs a sentence, write the sentence. Nobody has ever been harmed by too much clarity here.
- Update it if something changes between signing and closing.
Why This Protects You
Sellers experience the disclosure notice as exposure. It is closer to the opposite. A complete, honest notice, signed and dated, is the document that establishes what the buyer was told before they agreed a price. It converts a future argument into a closed question.
We ask for a full disclosure on every purchase for exactly that reason, and it is worth being suspicious of any buyer who tells you not to bother with one. If you want the process rather than the paperwork, how it works walks through it, and how to read a cash offer covers what else to look for before you sign.
This is general information, not legal, tax or financial advice. Texas procedure turns on the specific documents in your file and the dates on them. For anything involving a court, an estate, a lender or a taxing authority, talk to a Texas attorney or a HUD-approved housing counselor as well as to us.
Sources
- Texas Property Code Sec. 5.008 (seller disclosure of property condition) — the statutory notice and its exemptions
- Texas Real Estate Commission, forms and consumer information — the commonly used notice form