California Real Estate Law — Frequently Asked Questions

It depends on the legal claim. Some claims must be brought within two or three years of discovering the problem, and claims based on a written contract generally within four years. The clock can start running sooner than you think, and evidence disappears fast — so talk to an attorney as soon as you discover a problem.

The TDS is a form California law requires most residential sellers to complete, disclosing known material defects — anything that would affect the home’s value or a reasonable buyer’s decision. California Civil Code § 1102. If a seller knew about a problem and left it off the TDS, the buyer may have a claim.

Generally yes, if you cancel within your inspection, appraisal, or loan contingency periods. After contingencies are removed it gets harder, but a liquidated damages clause typically caps what an owner-occupied home seller can keep at 3% of the purchase price. See our earnest money disputes page for more.

Mediation usually costs a fraction of litigation and can resolve a dispute in a single day, while a lawsuit can take a year or more. Most California real estate contracts also require the parties to attempt mediation first to preserve their right to attorney fees.

If anything about the deal worries you — the disclosures, the agent’s advice, an unusual term — a one-hour review before you sign is far cheaper than a lawsuit after you close. Jimmy is both an attorney and a licensed broker, so he reviews contracts from both perspectives.

Yes. Closing escrow doesn’t waive your right to sue over a defect the seller knew about and failed to disclose. Many defects — foundation issues, unpermitted work, water intrusion — aren’t discoverable until after you move in. The deadline generally runs from when you discovered or reasonably should have discovered the problem, not from the closing date.

The SPQ is a supplemental disclosure form used alongside the TDS on the C.A.R. Residential Purchase Agreement. It asks more detailed questions — prior insurance claims, neighborhood disputes, permit history — that the TDS doesn’t cover. Sellers and their agents must answer both forms honestly; a false answer on either can support a non-disclosure claim.

Under California Civil Code § 3343, a defrauded buyer can generally recover the cost to repair the defect, the difference between what you paid and what the property was actually worth, and consequential damages like inspection or moving costs. Attorney fees and costs may also be recoverable if the purchase contract includes a prevailing-party clause. See our Real Estate Law page for the legal basis behind these claims.