These rules are inconsistent, however, so that the disclosure requirements in one state may be vastly different than another. And many states have no rules dealing with stigmatized homes, a legal gap which offers no guidance to buyers, sellers, or brokers. The result is that what must be said depends on where you live. A murder, for example, may have to be disclosed in one state, not disclosed in another, or disclosed today but not after several years. In looking at the various guidelines which impact stigmatized homes, it's little wonder that state rules are often divided on this issue.
Stigmas relate to personal values, preferences, and perceptions, matters difficult to legislate.
If you own a property which is or may be sitgmatized, or if you are considering the purchase of such a property, be certain to first speak with knowledgeable brokers and attorneys in your state to see what disclosures, if any, are required. It can be a lump sum paid to an owner, or a credit line where the owner can make withdrawals from time to time. As the owner repays the credit line, the amount of available credit increases up to a given limit. A home equity loan is typically a second mortgage or a second trust. However, if a home is owned free and clear and the owner obtains a home equity loan, the loan would be a first mortgage or trust.