The Inherited Rental and the Waived Inspection
A seller inherited a 1974-built Henderson house from his mother and has rented it out for eight years; he has never lived in it. He tells his listing agent, 'I don't know anything about the property, so I'll just check no on everything.' The agent has already heard from the tenant that the roof leaked badly last winter and that a bathroom was remodeled without permits. The buyer is an out-of-state investor paying cash, wants a ten-day close, and says, 'I'm waiving inspections, just give me the keys.' The parties are using a Nevada residential purchase agreement with an as-is clause.
1. What are the seller's disclosure obligations, and may the agent let him answer no across the board?
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Nevada requires a written seller's real property disclosure statement for the transfer of residential property of one to four units, unless a specific statutory exemption applies. Whether the inherited-and-rented posture fits an exemption is a question for the broker and counsel, not a guess by the listing agent, and the agent should resolve it before the disclosure deadline rather than after.
Separately, and independent of the form, a seller may not misrepresent known material facts. The seller here has been told by his own tenant about a roof leak and unpermitted work. Even if he never personally climbed on the roof, he now has knowledge through his agent, and the agent's knowledge is imputed to him.
So the agent may not let him check 'no' on everything. Where the form permits a seller to indicate that he has no knowledge or makes no representation on a given item, that is a truthful answer if it is true. Stating 'no defect' about a roof the seller has been told leaks is a false statement, and an agent who prepares or assists with it becomes a participant in the misrepresentation.
2. Do the as-is clause and the buyer's inspection waiver protect the seller from the roof and the unpermitted bathroom?
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They shift some risk. They do not erase the duty to disclose what is known.
- As-is means the buyer takes the property in its present condition and does not get a repair credit. It does not mean the seller may conceal known defects or make false statements. Fraud and misrepresentation survive an as-is clause in every jurisdiction that matters here.
- Waiving inspections is the buyer's bargain to make. It weakens the buyer's later argument that a visible condition should have been discovered, and it strengthens the seller's position on conditions that a reasonable inspection would have revealed.
- A latent condition the seller actually knew about - a roof that leaked badly last winter - is the weak spot. As-is plus a waiver does not cover active concealment, and it does not cover a false answer on a disclosure form.
- The unpermitted bathroom is a separate problem: it may affect insurability, permitted square footage, and future resale. The seller should disclose the unpermitted work and let the buyer price it, rather than let the buyer discover it at resale.
The right posture: disclose, document the buyer's informed waiver, and recommend the buyer inspect anyway in writing.
3. The buyer demands a ten-day close. What should the agent do about disclosure timing and documentation?
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Compressing the calendar does not compress the obligation. Advise the seller in writing that the disclosure must be delivered early enough that the buyer's statutory review and rescission window can actually run, and that a late delivery can hand the buyer a rescission right after the seller thinks the deal is done. A ten-day close can work, but it means the disclosure goes out on day one, not day eight.
Documentation to build into the file:
- The completed disclosure form, signed and dated by the seller, with the unpermitted bathroom and the roof history addressed truthfully.
- Written confirmation of which, if any, statutory exemption the seller believes applies, with the reasoning and the broker's review.
- The buyer's written waiver of inspections, signed by the buyer, plus a written recommendation that the buyer obtain inspections and a permit search anyway, so the waiver is informed rather than a surprise later.
- A written acknowledgment of receipt of the disclosure, dated, so the review period is provable.
- The as-is language in the purchase agreement, cross-referenced to the disclosure so the two documents do not contradict each other.
Finally, tell the seller plainly: if the buyer later finds the roof rot or the unpermitted bath and the file shows the seller knew, the ten-day close will not be the story anyone remembers.