Understanding ROE-370: The Real Estate Disclosure Form for Property Sellers

The ROE-370, or Real Estate Owned-370 form, is a legally mandated disclosure document that sellers must complete to inform potential buyers about the property's condition and any known material defects. Failing to properly complete the ROE-370 can lead to significant legal and financial repercussions for the seller, including post-sale lawsuits. This guide explains the form's purpose, key sections, and the seller's obligations to ensure a transparent and legally compliant transaction.

What is the ROE-370 Form?

The ROE-370 is a standardized disclosure form used in many U.S. states. Its primary function is to create a transparent record of the property's condition from the seller's perspective. Sellers are required to disclose any known issues with major systems and components, such as the roof, foundation, plumbing, and electrical systems. The concept of material defect is central to this form; it refers to any issue that could significantly impact the property's value or a buyer's decision to purchase. Completing this form honestly is a critical step in the selling process, as it helps manage buyer expectations and reduces the risk of future disputes.

Key Sections of the ROE-370 Explained

The form is typically divided into several sections, each focusing on a specific aspect of the property. Sellers must check boxes indicating the condition of each item, often with choices like "Yes," "No," or "Unknown."

• Structural Systems: This section covers the foundation, walls, and roof. Sellers must disclose any known history of leaks, cracks, or repairs.
• Plumbing and Electrical Systems: Here, sellers report on the age and condition of pipes, wiring, panels, and fixtures. Known issues like frequent clogs or faulty circuits must be noted.
• Appliances and Fixtures: The form will list major appliances (oven, dishwasher) that are included in the sale, and their operational status.
• Environmental Hazards: Sellers may need to disclose knowledge of hazards like lead-based paint, asbestos, or radon gas, especially in older homes. Federal law, for example, requires a specific lead-based paint disclosure for homes built before 1978.

It is crucial to note that selecting "Unknown" is acceptable if the seller genuinely has no knowledge of an issue. However, willfully concealing a known problem can be considered fraud.

The Seller's Legal Obligations and Liability

The completion of the ROE-370 is not merely a formality; it carries legal weight. By signing the form, the seller attests to the accuracy of the information provided under penalty of perjury. If a buyer discovers a major defect that was known to the seller but not disclosed, the buyer may have grounds to sue for damages. These damages could cover the cost of repairs or even lead to the rescission of the sale. Based on our experience assessment, thoroughness and honesty are the best protections against post-closing litigation. It is always advisable to review the completed form with a real estate attorney to ensure full compliance with state-specific laws.

How Buyers Should Use the ROE-370

For buyers, the ROE-370 is a valuable starting point for their due diligence. It provides insight into what the seller knows about the property. However, it should never be considered a substitute for a professional home inspection. A certified home inspector will conduct a thorough, unbiased examination of the property, often uncovering issues that the seller may have been unaware of or that developed after the form was completed. Buyers should cross-reference the disclosures on the ROE-370 with the findings of their independent home inspection report.

To navigate the ROE-370 process effectively: sellers must prioritize full transparency to avoid legal pitfalls, while buyers should use the form as a guide for further investigation. Understanding this essential document helps both parties proceed with greater confidence, ensuring the transaction is built on a foundation of disclosed information rather than unforeseen surprises.