Texas FSBO disclosure requirements: what you must tell the buyer

Texas requires most home sellers to complete a Seller’s Disclosure Notice before the buyer signs the purchase contract. The law is Texas Property Code Section 5.008, and it applies to FSBO sellers exactly the same way it applies to sellers working with agents. You fill out the TREC form, you disclose what you know, and you deliver it on time. Skip it or lie on it, and the buyer can terminate the deal or sue you after closing.

Here’s what the form covers, when you have to deliver it, who’s exempt, and the Texas-specific items that trip up sellers who’ve never filled one out before.

Where to get the form

The Texas Real Estate Commission (TREC) publishes the official Seller’s Disclosure Notice. The current version is TREC Form 55-0. Download it directly from the TREC website at trec.texas.gov. It’s free. Don’t pay a third-party site for it.

If your home is in a Property Owners’ Association (POA), you may also need TREC Form OP-H, which covers HOA-specific disclosures. TREC updated both forms in September 2023, and changes went into effect for 2024. Always download the latest version before you start filling anything out.

If you’ve already worked through the Texas purchase agreement, you know how TREC forms work. The disclosure notice follows the same pattern: mostly checkboxes, some write-in sections, and a signature at the end.

What the form covers

The TREC Seller’s Disclosure Notice runs about six pages and breaks down into three main sections. Each one asks you to mark items as Yes, No, or Unknown.

Section 1: what’s on the property

This section asks whether specific features and items are present. Think of it as an inventory. You’re telling the buyer what comes with the house.

The list covers appliances (range, oven, microwave, dishwasher, trash compactor, garbage disposal), fixtures (ceiling fans, light fixtures, window screens), systems (central air, central heat, wall furnace, attic fan, exhaust fan), water features (private pool, hot tub, pool equipment), outdoor items (patio, deck, outdoor grill, fencing, sprinkler system, security system), and infrastructure (intercom, smoke detectors, carbon monoxide detectors, fire detection equipment, cable TV wiring, satellite dish).

You’re also asked about rain gutters, garage door openers with controls, water heater, water softener, and washer/dryer connections. Mark each one honestly. If you’re not sure whether something works, mark it “Unknown” rather than guessing.

Section 2: known defects and malfunctions

This is where things get serious. The form asks whether you’re aware of any defects or malfunctions in specific parts of the property:

Structural: Foundation, basement, walls, roof, ceilings, floors, doors, windows, and driveways. Texas has more foundation issues than almost any other state, thanks to the expansive clay soil across the DFW metroplex, Houston, San Antonio, and Austin. If you had foundation work done, disclose it. If you’ve noticed cracks in the slab, doors that won’t close, or uneven floors, put it on the form.

Systems: Interior walls, plumbing, sewer, septic system, electrical system, and mechanical systems. If your HVAC system is 15 years old and makes a sound you’ve been ignoring, disclose that. “It works but makes a weird noise” is a perfectly fine answer. The form isn’t asking for perfection. It’s asking for honesty.

Environmental: The form specifically asks about previous termite damage, wood rot, hazardous or toxic waste, asbestos, urea-formaldehyde insulation, radon gas, lead-based paint, aluminum wiring, and previous fires. It also asks about previous use of the property for the manufacture of methamphetamine.

Additional items: Previous flooding (whether or not related to a natural disaster), improper drainage, water penetration, location in a 100-year floodplain, location in a 500-year floodplain, present flood insurance coverage, previous claims filed with the National Flood Insurance Program, and settling, soil movement, or fault lines.

Section 3: ownership, legal, and regulatory

This section covers items like: current lawsuits or liens affecting the property, unpaid assessments, deed restrictions or covenants, government notices of zoning or building code violations, HOA membership requirements and fees, whether the property is in a Municipal Utility District (MUD) or other special taxing district, and whether any room additions or structural changes were made without required permits.

The MUD question is a Texas-specific detail that catches a lot of sellers. Municipal Utility Districts levy taxes on top of your regular property taxes to pay for water, sewer, and drainage infrastructure. Buyers from out of state are often shocked by MUD taxes, which can add $3,000 to $6,000 per year on a $400,000 home. If your property is in a MUD, say so on the disclosure and have the MUD tax rate handy.

The standard you’re held to

Texas uses a “best of the seller’s belief and knowledge” standard. That’s a direct quote from the statute. You’re answering based on what you actually know, not what you should have known or what a reasonable person would have discovered.

You are not required to hire an inspector. You are not required to conduct any independent investigation. You are not required to get on the roof with a flashlight. If you genuinely don’t know the condition of something, mark it “Unknown” and you’re in compliance.

But here’s the flip side: if you do know about a problem and you mark “No” or “Unknown” instead of “Yes,” you’ve just lied on a legal document. Texas courts have been clear that the subjective knowledge standard works both ways. It protects honest sellers who genuinely didn’t know about a defect. It exposes sellers who knew and chose to hide it.

When to deliver the disclosure

The law says you must deliver the Seller’s Disclosure Notice to the buyer on or before the effective date of the purchase contract. “Effective date” means the day the last party signs the contract. In practice, most sellers have the disclosure ready before they list the property so they can hand it to any buyer who makes an offer.

If you deliver the disclosure late — after the contract is already signed — the buyer gets seven days from the date they receive it to terminate the contract for any reason. No questions asked. They get their earnest money back. All of it.

If you never deliver the disclosure at all, the buyer can terminate at any point before closing. That means you could be three weeks into escrow, the appraisal could be done, the title search could be clear, and the buyer can still walk away with their full earnest money because you never gave them the disclosure.

For FSBO sellers, the takeaway is obvious: have the disclosure done before you even list the property. Your real estate attorney can review it in 15 minutes, and it eliminates the single easiest way for a buyer to kill your deal.

Who’s exempt

Not every seller in Texas is required to complete the Seller’s Disclosure Notice. Section 5.008(e) lists several exemptions:

Transfers pursuant to a court order. If a court is directing the sale (foreclosure, partition, divorce decree), no disclosure is required.

Transfers by a trustee in bankruptcy. Bankruptcy sales are exempt.

Transfers by a mortgagee or beneficiary under a deed of trust. Bank-owned property doesn’t come with a seller’s disclosure from the bank.

Transfers by a fiduciary in the administration of a decedent’s estate, guardianship, conservatorship, or trust. Probate and estate sales are exempt. If you’re selling an inherited home, you likely qualify for this exemption — though it depends on how the property was transferred to you. Ask your attorney.

Transfers from one co-owner to another. If you’re buying out a co-owner (common in divorce), no disclosure is needed.

Transfers to a spouse or a person in the lineal line of consanguinity. Family transfers to parents, children, or grandchildren are exempt.

Transfers of new residences not previously occupied. Brand-new construction doesn’t require a seller’s disclosure because there’s nothing to disclose.

Even if you’re exempt, you still have to comply with the federal lead-based paint disclosure for homes built before 1978. That’s a separate federal requirement that no state exemption overrides. And exemption from the disclosure form doesn’t exempt you from the common-law duty to avoid fraud or misrepresentation. If a buyer asks a direct question about a known defect, you still have to answer honestly.

”As is” does not mean “no disclosure”

This misconception gets Texas sellers sued. Selling a home “as is” means you’re not agreeing to make repairs. It does not mean you can skip the disclosure form, and it does not protect you from liability if you hide a known defect.

Texas courts have said this clearly. An “as is” clause, no matter how broadly written, only protects an honest, disclosing seller. If you knew about foundation cracks, marked “No” on the disclosure, added an “as is” clause to the contract, and the buyer later discovered $40,000 in foundation damage, you’re exposed to a fraud claim. The “as is” clause won’t save you.

The general seller’s disclosure guide covers this in more detail for all states. In Texas specifically, case law has been consistent: you must disclose first, then negotiate “as is” terms if you want to. The order matters.

Texas-specific items that catch sellers

Beyond the standard categories, Texas has a few disclosure areas that sellers in other states don’t deal with.

Foundation issues. Texas sits on some of the most problematic soil in the country. Expansive clay soil expands when wet and contracts when dry, shifting foundations over time. If you’ve had foundation work done — piers installed, slab leveled, drainage corrected — that’s a mandatory disclosure. Even if the repair fixed the problem, the fact that you had work done goes on the form.

Flooding and floodplain. The form asks whether the property is in a 100-year or 500-year floodplain, whether you have flood insurance, and whether you’ve filed any previous claims with the National Flood Insurance Program. After the damage from Hurricane Harvey (2017), Texas flood disclosure has become one of the most scrutinized sections. If your home flooded, even if it wasn’t in a designated floodplain, disclose it.

Mineral rights. Texas has a robust mineral rights market, and rights can be severed from the surface estate. The disclosure form asks whether you’ve transferred or reserved any mineral rights, water rights, or other subsurface rights. If a previous owner sold the mineral rights decades ago, you may not own them. Check your deed, and disclose what you find.

Municipal Utility Districts (MUDs). As mentioned above, MUD taxes can significantly increase the buyer’s annual tax burden. The disclosure requires you to disclose whether the property is in a MUD. If it is, the buyer will also receive a separate MUD notice at closing.

Private water wells and septic systems. If your property uses a private water well or septic system instead of city water and sewer, the disclosure form asks about the condition of both. For well water properties, the buyer will want water test results. If you’re selling a rural Texas property with a well, the well water disclosure guide at HydroHearth covers the testing and disclosure process in detail.

What happens if you get it wrong

If a buyer discovers after closing that you knew about a defect and didn’t disclose it, they have several legal options:

Rescission. The buyer can ask a court to unwind the entire sale. You take the house back, refund the purchase price, and reimburse the buyer’s closing costs and attorney fees. This is the nuclear option, and courts grant it when the undisclosed defect is severe enough that the buyer wouldn’t have purchased the property at any price.

Damages. The more common remedy. The buyer sues for the cost of repairs plus any diminished property value. A $15,000 foundation repair becomes a $15,000 judgment, plus their attorney fees, plus potentially your attorney fees.

Fraud claims. If a court determines you intentionally concealed a known defect, punitive damages are on the table. Texas doesn’t cap punitive damages in fraud cases the way some states do. A $15,000 repair can turn into a $45,000 or $60,000 judgment.

DTPA claims. The Texas Deceptive Trade Practices Act (DTPA) can apply to real estate transactions. A DTPA violation can result in up to three times the actual damages plus attorney fees. Courts have applied DTPA to sellers who made affirmative misrepresentations on disclosure forms.

The statute of limitations for most disclosure-related claims in Texas is four years. That’s four years from the date the buyer discovers the defect (or should have discovered it), not four years from closing. A hidden foundation problem that doesn’t surface for two years still gives the buyer two more years to file suit.

How to fill it out without making mistakes

Your real estate attorney will review the form before it goes to the buyer, but here’s how to approach it on your own first.

Walk the property with the form in hand. Go room by room. Check every item on the list. Turn on every appliance. Open every faucet. Test every light switch. This isn’t a legal requirement, but it’s smart practice. You can’t claim you “didn’t know” about a dripping kitchen faucet if the buyer’s inspector photographs it two weeks later.

When in doubt, mark “Unknown.” The form gives you three options: Yes, No, and Unknown. Unknown is your friend. It’s legally compliant. It tells the buyer “I haven’t investigated this specific item.” Don’t guess. Don’t assume. If you don’t know, say so.

Err on the side of more disclosure. A repair you disclose is a negotiation point. A defect you hide is a lawsuit. When sellers ask me what to disclose, I say the same thing every time: if the question even crosses your mind, put it on the form. No one has ever been sued for disclosing too much.

Keep documentation. Save receipts for every repair, copies of insurance claims, inspection reports, permits, and any correspondence about property issues. If a dispute arises years after closing, your documentation is your defense. The form says “to the best of the seller’s belief and knowledge” — your records prove what you knew and when you knew it.

Don’t forget the lead paint disclosure. If your home was built before 1978, the federal lead-based paint disclosure is required on top of the Texas disclosure. Your attorney will handle the form, but you need to provide any lead inspection reports or records you have. Federal penalties for skipping this are up to three times the actual damages, and the EPA can impose civil fines of $11,000+ per violation.

Your disclosure checklist for Texas

Before listing your property, get these done:

• Download TREC Form 55-0 from trec.texas.gov (free)
• Download TREC Form OP-H if your property is in a Property Owners’ Association
• Walk through every room and complete the form honestly
• Gather documentation: repair receipts, insurance claims, permits, inspection reports
• Check whether your property is in a MUD, floodplain, or other special district (your county appraisal district website has this info)
• Check your deed for mineral rights reservations or transfers
• If your home was built before 1978, prepare the federal lead-based paint disclosure
• Have your real estate attorney review the completed form
• Deliver the form to the buyer before or on the day the purchase contract is signed

The entire process takes about an hour of your time, plus 15 minutes of your attorney’s. Compare that to the cost of a lawsuit. Disclosure is the cheapest insurance policy in real estate.

Your next step: download TREC Form 55-0, fill it out with the form in one hand and this guide in the other, then hand it to your attorney for review. If you haven’t hired an attorney yet, here’s how to find one. For the full paperwork picture from contract to closing, the FSBO closing checklist covers every document you’ll need.