When to Expect the Disclosure Report—And How to Deal With Problems
Exactly when you’re given the seller’s disclosures varies by state. In a few states, such as Alaska, Kentucky, and New Hampshire, sellers must give you disclosures before you’ve made an offer. But most states don’t require the seller to do this until after you’ve made an offer, often just before the two of you sign the purchase agreement.

What you read in the seller’s disclosure report may affect your decision whether to make an offer. To find out more about a topic mentioned in the form, ask for it in writing. Be sure that your contractor checks out some of these items in more detail as part of the home inspection that most buyers arrange.

If you receive the disclosure form after making an offer, you can cancel the sale if you don’t like what you read.

Even after the sale has closed, if a problem pops up that you believe the seller knew about and didn’t disclose, you can sue the seller on that basis. See the Nolo article Home Defects: Sue the Seller for details.

Penalties for Seller Failure to Disclose
Most states put some teeth into their disclosure laws, by allowing buyers to cancel the sale if the seller doesn’t provide the disclosure form or doesn’t fill it out completely and honestly. Some states also charge monetary penalties to sellers who violate the law, or punish sellers’ real estate agents for failing to disclose problems that they observed or were told of by the sellers.

 But remember that in most states, sellers aren’t required to poke around for problems—just to tell you what they already know. A house’s owners can remain blissfully unaware of many serious problems—a cracked foundation, termites deep in the walls, or a roof on the verge of leaking—and won’t be held responsible. That’s why getting a professional home inspection is highly recommended. See the Nolo article Getting a Home Inspection for more on the subject.  And be sure to do a careful review of any inspections the seller provides such as pest reports (common in California).