When you’re buying or selling a home, you want to trust that the information the other party has given you is accurate. Unfortunately, that’s not always the case.
Misrepresentation in real estate can leave you in a tough spot, feeling deceived or stuck in a deal you wouldn’t otherwise have agreed to.
Proving misrepresentation involves evidencing that the information you were given was false and that it caused you harm. This can be complex, so it’s best to seek support from a real estate attorney in South Carolina.
Our real estate lawyers at Savage, Royall & Sheheen, LLP., can support you with your misrepresentation case and help you get the justice you deserve.
What Is Misrepresentation in Real Estate?
Misrepresentation in real estate occurs when someone involved in a property transaction provides false, incomplete, or misleading information about the property. This misinformation can come from a seller, real estate agent, or another party involved in the deal.
The key issue is that the misrepresentation influences the buyer’s decision-making process, often leading to financial losses or other complications after the purchase.
Not all misrepresentation is intentional, though. The law categorizes misrepresentation into three main types:
1. Innocent Misrepresentation
This happens when someone unknowingly provides incorrect information about the property. For instance, the seller might genuinely believe the roof was replaced five years ago when it was ten.
2. Negligent Misrepresentation
This involves carelessness. If a seller or agent should have known the information was incorrect but didn’t bother to verify it, they could be guilty of negligent misrepresentation.
3. Fraudulent Misrepresentation
This is the most serious type. It occurs when someone knowingly and intentionally lies or withholds important facts to deceive the buyer.
Common Types of Misrepresentation
Misrepresentation in real estate can take many forms. Below are some of the most common types of misrepresentation that arise in real estate transactions:
1. Property Condition Misrepresentation
This could include a failure to disclose major defects like a cracked foundation, roof leaks, faulty wiring, or mold problems. Sellers or agents may minimize these issues or outright lie, claiming the property is in “excellent” or “move-in ready” condition when it’s not.
2. Boundary Misrepresentation
Property lines and boundaries are a common source of confusion. Misrepresentation occurs when a seller inaccurately describes the size or boundaries of a lot. For example, they might claim the backyard extends beyond its actual limits or fail to disclose easements that give others rights to access parts of the property.
3. Zoning and Use Misrepresentation
Buyers are often concerned about how they can use a property, especially for investment purposes. Misrepresentation may involve false claims about zoning laws, such as stating a property is zoned for commercial use when it’s not.
Similarly, sellers may promise that a property can accommodate future additions or renovations that local regulations prohibit.
Steps to Take if You Suspect Misrepresentation in a Real Estate Deal
If you suspect misrepresentation in your real estate deal, here’s what you should do:
- Gather Documentation: Start by collecting all relevant paperwork and communication records related to the property and the transaction. This includes the purchase agreement, disclosures, property listings, correspondence (emails, texts), and any advertising materials.
- Conduct an Independent Evaluation: Hire an independent inspector or appraiser to assess the property. This expert can provide an objective report on the condition of the property and any discrepancies between what was disclosed and the actual state of the property.
- Consult a Real Estate Lawyer: Contact a real estate lawyer as soon as you can. A real estate lawyer can offer a professional evaluation of your case, help you understand your legal options, and guide you through the process of seeking remedies.
- Review Your Legal Options: Your lawyer will explain the potential legal actions you can take. Depending on the nature of the misrepresentation, you may be entitled to various remedies such as rescission of the contract, compensation for any losses, or enforcement of specific contractual obligations.
- Prepare for Possible Litigation: While many misrepresentation cases can be resolved through negotiation or mediation, some may require litigation. Be prepared for the possibility of going to court, which involves presenting your evidence and arguments in front of a judge or jury.
Potential Remedies and Damages for Misrepresentation in Real Estate
The law provides several remedies to address misrepresentation issues, helping to rectify the damages caused by such deceptive practices. Some potential remedies available to victims of misrepresentation in real estate include:
Recession of the contract. This essentially cancels the real estate transaction, returning both the buyer and seller to their original positions before the deal was made.
Damages compensation. If rescission isn’t feasible or desired, the wronged party may seek monetary damages. This form of compensation aims to cover any financial losses the buyer has incurred because of the misrepresentation.
Equitable relief. Sometimes, a court may fashion a remedy that doesn’t fit neatly into the categories of rescission or damages. This might include renegotiating certain terms of the contract or requiring the seller to cover ongoing costs related to the misrepresentation.
Specific performance. In cases where monetary compensation is inadequate to remedy the harm, the court may order specific performance. This requires the seller to carry out certain actions they initially agreed to before the misrepresentation was revealed.
The Role of a Real Estate Lawyer in Misrepresentation Cases
A real estate lawyer will start by identifying whether your case qualifies as misrepresentation under the law. If we identify misrepresentation, we’ll gather all of the evidence, such as:
- Evaluations from inspectors or appraisers
- All correspondence related to the property transaction
- Contractual agreements
We’ll then advise you on the most effective legal remedies for your case. For example, seeking rescission of the sale, and therefore nullifying the transaction, or pursuing compensation for any losses.
A real estate lawyer will also represent you in negotiations and, if necessary, court proceedings.
We’ll advocate for your best interests and aim to secure a fair resolution without a lengthy legal battle. However, if a satisfactory settlement can’t be achieved, we’re prepared to litigate on your behalf.
Contact Our Real Estate Transaction Attorneys
If you believe you’ve been affected by misrepresentation in a real estate transaction, contact Savage, Royall & Sheheen, LLP., at 803-432-4391.
With our experienced attorneys by your side, you can tackle the challenges of misrepresentation head-on.