Fifty percent of buildings in North America are at high risk for mold. Knowing that you are in good company, however, doesn’t make finding mold in a home you want to sell any less panic-inducing.
Discovering mold raises a slew of questions. Can you sell a house with mold? Do you have to disclose mold when selling a house?
Here are the facts.
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Why Mold Matters
Americans spend between 80 and 90 percent of their time indoors. This means that indoor air quality has a tremendous impact on their health and well-being. Mold can substantially reduce indoor air quality.
In sensitive individuals, it can contribute to:
- Brain fog
- Depression or anxiety
Left untreated over time, mold can also cause the physical structure of a home to deteriorate. It can eat through common housing materials like drywall, leading to cosmetic issues, safety concerns, and depreciation of the home’s value.
As a result, the presence of mold in a home can be a big deal for:
- Mortgage lenders
- Home insurance providers
But what does this mean for owners hoping to sell a home affected by mold?
What the Law Says
The biggest question most sellers have is “can you legally sell a house with mold?” Happily, the answer is yes. No federal or state laws prohibit owners from selling properties that contain mold.
What laws do regulate is disclosure. Each state has its own rules about disclosure, including what sellers must disclose and how. Most commonly:
- Sellers must denote any known defects in the home at the time of sale
- Sellers may not actively lie about known defects when asked
- Buyers bear primary responsibility for investigating the home and identifying potential problems
- Buyers may be able to take legal action against sellers post-sale if the home was substantially misrepresented
In practice, it is always in sellers’ best interest to disclose the presence of mold in homes even when state law does not require them to do so.
The Impact of Mold on the Traditional Selling Process
Individual buyers can vary widely in their sensitivity to mold. While some may not notice at all, others may take one step inside a mold-contaminated home and almost immediately experience:
- Redness and itchiness of the skin and eyes
- Stuffy nose
- Difficulty breathing
Disclosing mold can protect sensitive buyers from negative health impacts. It can also protect sellers.
Failure to Disclose
In nearly every traditional sale, buyers will order a home inspection. The inspection checklist is thorough and covers:
- Material defects
- Major defects
- Minor defects
- Cosmetic defects
As a result, buyers almost always discover the presence of mold even when sellers do not disclose it. If sellers did not disclose the mold, buyers and their agents often feel deceived. This can lead to:
- Deeper inspections to identify every problem with the property, no matter how small
- Sales falling through
- Sellers and their homes getting a reputation in their area as dishonest and not good to work with
All of this can then result in enormous difficulty in selling a home. It can become challenging to sell the home at all and, when it does sell, it often does so at far below market value.
Disclosing that a home is affected by various types of mold is not without its disadvantages. Sensitive buyers may still stay away. Interested buyers may include mold remediation requirements or discounts to the home price to cover such remediation costs in sale negotiations.
Having these conversations upfront, however, helps sellers avoid:
- Getting a bad reputation in the market
- Losing huge amounts of time negotiating sales that then fall through after an inspection
- Potential legal action by buyers who do not discover the mold until the sale is complete
- Running afoul of state and local laws about disclosure
Mold and Mortgages
Selling a home with mold can also be complicated by buyers’ need to get a mortgage and home insurance.
As a rule, mortgage lenders will not give buyers loans for more than a home is worth. Mold can affect lenders’ assessment of a home’s value, both at the time of sale and long-term. This can make it challenging for buyers to secure a mortgage for a property with mold.
At best, this delays sales and makes the entire process take longer. At worst, would-be buyers can fail to get a mortgage at all and be unable to buy the property.
Similarly, mortgage lenders require that buyers purchase insurance on a home as part of the buying process. Insurers may be reluctant to insure homes with ongoing mold problems, as this can represent potential costs to them down the line.
Difficulty securing insurance can lead to delays and challenges in securing a mortgage. All of this complicates home sales.
“What about mold remediation?” some sellers wonder. “Can I avoid disclosing mold if I remediate it before selling? Will I have more luck selling after remediation?”
Mold remediation may be an option for some properties, but sellers need to cultivate a clear understanding of what to expect before assuming that remediation will solve their problems.
It Starts With an Inspection
Do-it-yourself mold detection kits are not sufficient to help sellers identify and understand the scope of their mold problem. Instead, they will need to begin with a professional mold inspection. These inspections cost between $300 and $1,000 and identify the:
- Types of mold present
- The extent of mold contamination
- Causes of the mold problem
- Estimated remediation work and expense
Sellers often imagine that remediation is as simple as washing down affected areas with bleach. This is not the case.
Once present, mold can infiltrate behind walls, in HVAC systems, and other hard-to-see and hard-to-clean places. While bleaching visible areas can present a clean face, inspections will undoubtedly discover and call attention to hidden contamination.
Full remediation is therefore necessary but can be intensive, time-consuming, and expensive. It can involve:
- Removing portions of walls, ceilings, and floors
- Redoing plumbing and piping
- Cosmetic repair work to restore rooms and fixtures afterward
Remediation must also always be done by professionals, particularly when owners intend to sell the house, as this provides documentation and legal protection.
Remediating mold can help sellers attract the widest range of buyers and avoid price reductions when selling their homes. It does not, however, prevent them from needing to disclose the mold and its remediation during the selling process. Buyers who hear about a former mold problem may be extra diligent in looking for and demanding that sellers address any other potential home problems.
As such, many sellers find that mold remediation is extremely stressful and expensive but offers very little in the way of return on investment.
Can You Sell a House With Mold “as-Is”?
Faced with the frustrations inherent in both traditional real estate sales and mold remediation, many sellers wonder, “Can I sell a house with mold as-is?” The answer is that they absolutely can. Moreover, selling as-is can be an attractive and smart option.
As-is sales allow homeowners to sell:
This is particularly true when sellers bypass traditional sales and connect with cash buyers. These buyers have a host of advantages over traditional buyers.
First, they do not need to qualify for mortgages or standard home insurance policies. This means that concerns like mold, which might present real barriers to purchase for other buyers, do not affect them. It also means that they can buy homes fast since they do not have to wait on third parties for paperwork processing and approval.
Second, cash buyers are not looking for homes they will need to move into immediately. This gives them leeway that other buyers often do not have. It makes them more willing and able to handle homes that need work.
Third, cash buyers look at the core value of a home rather than the cosmetics. Sellers don’t have to fuss with staging, curb-appeal upgrades, or other time-consuming or costly sale prep. This keeps money in their pockets and frees up time and energy for other things.
Finally, cash buyers often specialize in unique or complicated home sales. This makes them ideal partners for sellers dealing not only with mold but other challenges or unconventional situations, as well.
Get a Quote
Can you sell a house with mold as-is? Yes, and it has never been faster or easier to do than it is now. Get a quote today and discover just how convenient selling your home as-is can be.