The Environmental Protection Agency (EPA) and the U.S. Department of Housing and Urban Development (HUD) have issued a rule imposing new disclosure requirements on sellers, lessors and real estate agents dealing with residential housing built before 1978. Starting in September 1996, all sellers and lessors of pre-1978 housing will be required to disclose to prospective buyers or renters the presence of known lead-based paint, provide them with a federally-approved lead hazard information pamphlet and any available reports concerning the presence of lead-based paint, allow prospective buyers 10 days without obligation to conduct a risk assessment, and include certain disclosure and acknowledgement language in all sales and leasing contracts. The rule requires real estate agents to ensure compliance with the disclosure requirements. Failure to comply with the rule is punishable by up to $10,000 civil and $10,000 criminal penalties for each violation, as well as potential treble damages in a private civil suit.
Transactions that will be excluded from the disclosure requirements include foreclosure sales, the purchase, sale or servicing of mortgages, short-term leases of 100 days or less, and lease renewals.
