Deciphering the Disclosures: A San Jose Realtor’s Guide to Understanding a 300-Page Packet

Why So Many Pages? (And Why You Should Care)

California is consumer-protection heavy. Sellers must disclose almost everything they know; third parties add hazard, tax, and title data. That volume can feel brutal, but it’s also your shield. Properly read, it prevents surprise loans, hidden water damage, or HOA rule nightmares from biting you after closing.

The goal: Turn 300 pages into a handful of clear decisions:

• Buy as-is?

• Ask for repairs/credits?

• Renegotiate price or terms?

• Walk away and keep your deposit?

The 1-Hour Triage: How to Skim Smart Before You Dive Deep

Print or PDF? Use searchable PDFs and a notepad.
Highlight three colors:

• Red = potential deal breaker (foundation, major permit issues)

• Yellow = needs clarification or money (roof age, termite Section 1)

• Green = good-to-know (appliance ages, paint colors, dog park distance)

Five pages to read first:

1. Seller’s Transfer Disclosure Statement (TDS) – big-picture condition.

2. Seller Property Questionnaire (SPQ) – detailed history: leaks, repairs, neighbors, lawsuits.

3. Inspection Summaries (Home, Pest, Roof) – the “what’s wrong” cliff notes.

4. Preliminary Title Report – liens, easements, ownership chain.

5. Natural Hazard Disclosure (NHD) – fire, flood, earthquake fault zones.

If any red flags pop up, you already know where to focus deeper.

Seller Disclosures: TDS & SPQ—The “What They Know” Forms

Transfer Disclosure Statement (TDS):

• California standard form. Seller checks boxes on issues: roof, plumbing, electrical, additions, etc.

• Look for “yes” answers about past water intrusion, structural changes, or “unknown.” “Unknown” isn’t bad—it just means verify.

Seller Property Questionnaire (SPQ):

• More narrative detail: insurance claims, neighbor disputes, HOA violations, unpermitted work, past pest problems.

• Red flag words: “leak,” “settlement,” “crack,” “mold remediation,” “unpermitted ADU,” “lawsuit.”

How to use them:

• Cross-check: If SPQ says “roof leak 2019—repaired,” confirm in inspection report and invoices.

• Ask for receipts. Repairs without documentation = negotiate or inspect further.

Inspection Reports: Turning Tech Talk into Action Items

Typical inspections in San Jose packets: General Home, Pest/Termite, Roof, Sewer Lateral, Chimney, Pool/Spa, Foundation.

General Home Inspection:

• Big-ticket systems: foundation, roof, HVAC, electrical, plumbing.

• Key sections: Summary at the end, “Safety Hazards,” “Major Defects.”

• Normal: Minor code updates, old GFCI outlets, loose doorknobs.

• Not normal: Active leaks, significant foundation cracks, aluminum wiring, double-tapped breakers that show overheating.

Pest/Termite Report (Section 1 & Section 2):

• Section 1 = Active infestation/damage that must be corrected.

• Section 2 = Conditions that could lead to infestation (water against wood, earth-to-wood contact).

• Expect some Section 2 in older SJ homes; Section 1 costs give you negotiation ammo.

Roof Report:

• Remaining life estimate, flashing and valley checks.

• If roof has <5 years life, plan the budget or credit request.

Sewer Lateral/Chimney/Pool:

• Sewer camera reports reveal root intrusion or breaks—expensive digs.

• Chimney cracks, missing spark arrestors matter for safety and insurance.

• Pools: Equipment age, leaks, code fencing.

How to execute:

• Make a list of repair costs with your realtor and contractors.

• Decide: Ask for credit, fix yourself post-close, or walk.

The Preliminary Title Report: Ownership, Liens & Easements 101

This is the “who owns what” and “who else has a claim” doc.

What to scan:

• Deeds of Trust / Mortgages: Will be cleared at close, but confirm no surprise HELOCs.

• Easements: Shared driveways, utility access lines. Make sure they don’t block your ADU dreams.

• Liens/Judgments: Tax liens, mechanics liens—should be cleared, but note them.

Action step:

• Ask your escrow officer or realtor to highlight anything non-standard.

• Don’t ignore “exceptions” sections, those are items NOT insured by title.

Natural Hazard Disclosure (NHD): Fire, Flood, Fault Lines & More

San Jose spans hills, creeks, and urban cores. NHD reports bundle state-mandated maps:

• Wildfire Severity Zone (especially near Alum Rock, foothills of Evergreen).

• Flood Zones (Coyote Creek, Guadalupe).

• Earthquake Fault Zones (Calaveras, Hayward proximity).

• Radon, Airport Influence, Military Ordnance zones occasionally appear.

What it means:

• Insurance costs may be higher.

• Lenders may require specific coverage.

• Mitigation (clearing brush, sump pumps) may be wise.

HOA Docs & CC&Rs: Rules, Reserves, and Surprise Fees

Buying a condo or a home in communities like Silver Creek Valley Country Club? Expect 100+ pages:

Key pieces:

• CC&Rs (Covenants, Conditions & Restrictions): Pet rules, rental caps, ADU or exterior change rules.

• Budgets & Reserve Studies: Is the HOA saving enough for big-ticket repairs? Low reserves = future special assessments.

• Meeting Minutes: Look for talk of lawsuits, major repairs, owner disputes.

• Special Assessments: Any upcoming? How much, how long?

How to execute:

• Skim minutes for the past 12 months.

• Check rental caps if you plan to rent later.

• Verify monthly dues + any club fees (gyms, pools, golf).

Permits & Additions: Was That ADU Legal?

San Jose is ADU-friendly, but permits must match. Look for:

• City permit history printouts (your agent can pull).

• Unpermitted work disclosure in SPQ.

• Appraisal square footage vs. tax records: Mismatch? Could be unpermitted.

Risk: Unpermitted structures can affect insurance, resale, and financing.
Fix: Negotiate repairs or credits, or require seller to close permits before close.

Taxes, Mello-Roos & Special Districts

Beyond the standard ~1.1% property tax, some neighborhoods carry:

• Mello-Roos/CFD fees (especially newer Evergreen tracts)

• School bonds & parcel taxes (check bill breakdown)

• Utility district assessments

Action:
Ask escrow for a SAMPLE annual tax bill. Budget accordingly.

Loan, Appraisal & Contingency Clauses: What the Contract Really Says

Your purchase contract has timelines:

• Inspection contingency: Usually 5–17 days. Miss it, lose leverage.

• Appraisal contingency: Protects you if value comes in low.

• Loan contingency: Gives you an exit if financing falls through.

Clarify:

• Can you extend if inspectors need more time?

• What happens if appraisal is low—price drop, split the gap, or walk?

Red Flags vs. Yellow Flags: A Quick Reference

Red Flags:

• Foundation movement with engineer notes recommending major repair

• Active roof leak + mold noted, no remediation proof

• Unpaid liens that seller refuses to clear

• HOA litigation involving structural issues

• Illegal unit that city is actively citing

Yellow Flags (Negotiate, Don’t Panic):

• Minor Section 1 termite items

• GFCI outlets missing in garage/kitchen

• Older water heater without seismic straps

• Past leak repaired with receipts

• Reserve fund slightly low but special assessment plan disclosed

How Your Realtor (Should) Help

A disclosure packet is not DIY. Here’s what a client-first San Jose realtor does:

• Summaries: Deliver a 2–3 page “What Matters Most” memo.

• Layered review: First pass (deal breakers), second pass (negotiation items), final pass (FYIs).

• Vendor network: Roofers, pest pros, foundation engineers on call to quote fast.

• Negotiation strategy: Credits vs. repairs, price cuts vs. closing cost help, or timing extensions.

• Translation: Explaining legalese and technical jargon calmly, so you can choose confidently.

Your 15-Point Disclosure Checklist

1. Seller TDS/SPQ: Any “yes” answers that scare you?

2. General Inspection: Structural, plumbing, electrical, HVAC hits?

3. Pest Report: Section 1 costs?

4. Roof Report: Remaining life?

5. Sewer/Chimney/Pool: Any serious cracks, breaks, or leaks?

6. Title Report: Liens, easements, ownership anomalies?

7. NHD: Fire/flood/quake zones? Insurance cost impact?

8. HOA Docs: Reserves, rules, rental caps, special assessments?

9. CC&Rs: ADU/parking/pet limits?

10. Permits: Do city records match the house?

11. Taxes: Mello-Roos, parcel taxes, bond assessments?

12. Appraisal risk: Is list price way above comps?

13. Loan terms: Rate lock, points, lender fees?

14. Contingency deadlines: Calendar them!

15. Final walk-through: Confirm repairs done, no new damage.

Script: Smart Questions to Ask the Listing Side

• “Were any repairs made after inspections? Can we see invoices?”

• “Has the seller ever filed an insurance claim on the property?”

• “Any pending HOA projects or assessments not yet in minutes?”

• “Are there open permits or final inspections outstanding?”

• “Any recent offers fall out? Why?”

Conclusion: Information Isn’t Meant to Scare You—It’s There to Empower You

A 300-page disclosure packet is intimidating, but it’s also the best tool you have to protect your investment. With a diligent, transparent San Jose realtor in your corner, you don’t have to read every line alone or guess what matters. We translate, triage, and negotiate—so you can focus on loving (and understanding) the home you choose.

Ready for a no-pressure disclosure review?
Block Change Real Estate will comb through the packet with you, highlight the real risks, and map out your options—credit, repair, or walk.