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Effective June 1, 1998, Assembly Bill 6X
required a Natural Hazards Disclosure Statement to be used in certain real
estate transfers in which the real property is improved with one to four
dwellings, the property required a Real Estate Transfer Disclosure Statement
and the property is located on a natural hazard area.
What areas are considered natural hazard
areas?
Below are some natural hazard areas:
- Zone A of flood insurance rate maps issued by the Federal
Emergency Management Agency pursuant to the National Flood Insurance Act of
1968.
- An area that may be at risk of forest fire or brush fire.
- An earthquake fault zone (usually about 1/4 of a mile
radius).
- A seismic hazard zone (risk of damage by ground shaking,
landslide or soil liquefaction).
- An area which will flood if a dam breaks.
A property must be marked as being in a natural
hazard area unless a form prepared by an expert according to Civil Code Section
1102.4 © is attached, if a person looking on a map cannot tell with
certainty if the property is in a natural hazard area or not.
What liability exists?
Liability
comes from not disclosing available and/or known information, and the failure
to disclose results in material damages. If it can be proven that the
information was known and/or reasonably available to the seller or the seller's
agent, then a liability case can be established if the information could have
prevented the material damages.
When do you get a disclosure
report?
As a Realtor®, you can order the report at any
time, but you might be responsible for payment of the report in the event of a
cancellation. However, many companies only collect if the escrow closes, and
some companies even require the return of the report if there is a
cancellation. Most Realtors® order the report through escrow,
upon the escrow agent's receiving their instructions from the escrow
officer.
Who pays for the disclosure
report?
Usually the seller pays, although this is not required by
law.
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