What is the primary purpose of the Seller's Disclosure Statement?

The primary purpose of the Seller's Disclosure Statement is to inform potential buyers of known defects in the property. This legal document serves as a way for the seller to communicate any issues related to the property that could affect its desirability or value. By disclosing information about defects or problems—such as structural issues, water damage, or problems with major systems like plumbing or electrical—sellers help ensure that buyers can make informed decisions before proceeding with the purchase. This transparency is critical as it helps to protect the interests of both parties and minimize disputes after the sale has been completed.

The other options do not align with the core purpose of the Seller's Disclosure Statement. Appraisal values are determined by professionals and are not typically included in the disclosure. Outlining the terms of the sale is usually handled in a separate contract. Additionally, while a seller's financial situation might be discussed in certain contexts, it does not pertain to the Seller's Disclosure Statement, which focuses primarily on the condition and defects of the property itself.