Here's What Happens When a Real Estate Listing Contains a Lie

If you're buying a home, you may be gearing up for the largest purchase of your life. So it's important to do plenty of research before making an offer and going through the process of applying for a mortgage.

One thing you're likely to do when researching properties is look at their MLS listings. But what if you decide to move forward with an offer on a home whose listing contains a lie? Or, worse yet, what if you actually sign your mortgage and move into that home, only to then realize you were lied to?

The good news is that it's illegal to produce a real estate listing with false information. So if you can prove that you were lied to, you may have recourse.

You're entitled to the truth

Misinformation on a real estate listing could end up costing you money as a buyer in one way or another. So you're entitled to an accurate listing.

If you were lied to in a listing and you haven't yet closed on your home, that may be grounds to walk away from that purchase without losing the deposit you put down at the time of your offer. You'll need to consult your real estate attorney to see what rights you have.

If you've already moved into your home and uncovered a lie, that's a trickier situation. But even then, you may have recourse. If you can prove there was a blatant lie in the listing you relied on, you may be able to sue your seller for misrepresenting their property. Again, talking to a lawyer is going to be your best bet here, because they'll be able to tell you what avenues to pursue.

You should also know that it may be possible to take legal action against a real estate agent who played a role in producing a listing with a lie. Whitney, LLP, a Maryland law firm, says that "real estate agents on both sides of a transaction have a duty to disclose all material facts to the buyer."

So, let's say a real estate agent puts together a listing that clearly misrepresents the condition of a given property. That misrepresentation may not be immediately obvious. But if you suffer a financial loss because of that lie, you may have grounds to sue.

What about an as-is property?

Some sellers like to cover their tails by listing their property "as is." When you see a listing like this, it's basically a sign the property in question has some issues, and the seller is not willing to fix them.

You may have less of a leg to stand on if you buy an as-is property and it turns out to have more issues than you expected after you move in. But again, sellers and their agents are required to disclose certain information on listings. So if there's a blatant omission, you might still have a case.

Unfortunately, you can't always count on a seller or their agent to be truthful when putting together a real estate listing. It's really important to have a thorough home inspection when you're buying a home. This way, if the seller in question did lie, you're more likely to discover it. And then, you'll hopefully be in a position to either back out of the deal or demand compensation for the issue at hand.