What to Do If You Find Undisclosed Issues in Your New Home

How to protect your investment—and your peace of mind.

When you purchase a home, the seller is legally required to disclose known issues with the property. These disclosures typically include things like mold, water damage, foundation problems, lead-based paint (especially in homes built before 1978), pest infestations, and the presence of hazardous materials like asbestos. Discovering one of these issues after closing—when it wasn’t disclosed—can be both financially and emotionally overwhelming.

Whether the omission was an honest mistake or a failure to disclose by the seller or their representatives, there are several paths forward that can help you recover your costs or remedy the issue.

1. Check with Your Homeowners Insurance First

Before pursuing any legal action, review your homeowners insurance policy or consult with your insurer. Depending on the nature of the damage and your coverage, they may be able to help pay for repairs. Some policies include coverage for hidden water damage, pest infestations, or structural failures. If you’re unsure, ask your insurance adjuster to inspect the damage and advise you on your options.

2. Identify Who May Be Legally Liable

If insurance doesn’t apply, or only covers part of the issue, you’ll need to assess whether someone failed in their legal duty to disclose a material fact. In real estate law, “material facts” are any details that could influence a buyer’s decision to purchase or impact the value of the property.

The potentially liable parties include:

• The seller, if they knew about the issue and failed to disclose it or intentionally concealed it.

• The seller’s agent, if they were informed of the issue but failed to communicate it during the transaction.

• The home inspector, if they missed a defect that should have been identified during a reasonable inspection.

In some cases, more than one party may share liability. Determining who is at fault and to what extent will help guide your next steps.

3. Try to Resolve the Issue Without Going to Court

Before jumping into legal action, attempt to resolve the matter directly. This often begins with a formal demand letter, which outlines the issue, your damages (such as repair costs), and what you’re seeking from the other party. A well-written demand letter can lead to a settlement, especially if the other party wants to avoid legal exposure.

If that doesn’t work, mediation is a practical next step. This confidential process allows both parties to work with a neutral third party to try to reach a mutually agreeable solution, often faster and more affordably than a lawsuit.

4. When to Consider a Lawsuit

If informal negotiations or mediation fail, and the financial impact is significant where the cost of repairing the issue is much more than the costs you will incur to file a lawsuit, a lawsuit may be your most viable option. You’ll need to work with a real estate attorney to:

• Build evidence showing the issue existed before the sale and was not disclosed.

• Prove that the seller (or other party) knew or should have known about the issue.

• Estimate the total damages, including repair costs, loss of property value, or other financial impacts.

Lawsuits can be time-consuming and emotionally draining, but in some cases, they are necessary to recoup your investment and hold negligent parties accountable.

Know Your Time Limits

Most states have statutes of limitations for nondisclosure claims. These typically range from two to four years, depending on when the defect was discovered. If you suspect fraud or concealment, act quickly to preserve your rights.

Protect Your Home and Your Rights

Buying a home is one of the biggest investments you’ll ever make. If you discover something that wasn’t disclosed, you shouldn’t have to bear the burden alone. The attorneys at Anselmo & Wojcikci are experienced in handling nondisclosure claims and protecting homebuyers like you.

Contact us today to discuss your options in a confidential consultation. Let’s make things right.

About Anselmo & Wojcicki, LLP

Anselmo & Wojcicki, LLP is a multi-disciplinary law practice based in Schaumburg, Illinois, specializing in real estate, estate planning, tax planning, business formation, and the sale and purchase of businesses. Our commitment to our clients and our values set us apart from the crowd. Our team of legal specialists has a wealth of experience and expertise to help you meet your legal needs. We are dedicated to providing quality service and building lasting relationships with our clients.