What Is a Transfer Disclosure Statement (TDS)?

The Transfer Disclosure Statement, or TDS, is the statutory form California requires in most residential sales of one to four units. On it, the seller discloses the property's condition and any known material facts or defects: leaks, cracks, unpermitted work, neighborhood nuisances, insurance claims, deaths on the property within the statutory window, and more.

The duty comes from Civil Code section 1102 and following, and it cannot be waived in a standard sale. The seller must disclose what they actually know; the listing agent has a separate duty to conduct a reasonably competent visual inspection and disclose what it reveals. Delivering the TDS late gives the buyer a short statutory right to cancel. Lying on it, or leaving out what the seller knew, is the foundation of most California real estate fraud and nondisclosure cases.

For buyers, the TDS is the first document to pull when a problem surfaces after closing. For sellers, the safest course is simple: when in doubt, disclose, in writing, before acceptance.

Who Must Deliver a TDS, and What It Covers

The Civil Code generally requires the seller of residential real property of one to four units to deliver a Real Estate Transfer Disclosure Statement to the buyer. The form asks the seller to identify known defects and conditions across the structure, systems, and land, and to disclose items such as significant defects, additions or alterations made without permits, soil or drainage problems, neighborhood nuisances, and litigation affecting the property.

The seller's agent, and the buyer's agent where there is one, must also conduct a reasonably competent and diligent visual inspection of the accessible areas and disclose what it reveals. That agent inspection duty is independent of the seller's own disclosures.

Exemptions Are Narrower Than People Assume

Certain transfers are exempt, including many court-ordered sales, transfers by a trustee in bankruptcy, transfers from one co-owner to another, and some transfers by fiduciaries administering estates or trusts where the fiduciary never occupied the property.

Two points are widely misunderstood. First, an exemption from the TDS form does not exempt a seller from the separate common law duty to disclose known material facts affecting value or desirability. Second, selling a property "as is" does not cancel disclosure duties at all. As-is generally means the seller will not repair, not that the seller may conceal.

Remedies When the Disclosure Was Wrong

A buyer who receives a TDS after entering the contract generally has a statutory right to terminate within a short window, three days for personal delivery and five days for mail. Once escrow closes, the remedies shift to litigation: actual damages for negligent or intentional misrepresentation, concealment, or breach of the statutory duty, plus punitive damages where the concealment was deliberate.

Proof usually comes from the paper: prior repair invoices, permit history, insurance claims, prior listing photographs, and communications with contractors. See what to do when a seller did not disclose for how these claims are built.