MOLD: WHAT YOU NEED TO KNOW TO PROTECT YOURSELF & YOUR CLIENTS
Reduce their liability and avoid appearing on any nightly news magazine programs
Is there any single issue facing REALTORS® that has generated more hype, hysteria, and misinformation than Mold?
The news is filled with stories entitled, Mold is Gold, Black Mold: Creeping Destruction, Mold: The New Creeping Invader, and Death Mold Killed My Dog.
There are famous celebrities like Erin Brockovich and Ed McMahon who have had well publicized problems with mold in their own homes. It has even reached the comics section of the newspaper with the Rex Morgan, M.D. comic strip featuring a 20-week series on "Toxic Mold" in an apartment building. But what does all this mean to REALTORS® and the clients who look to you for advice?
First, to paraphrase a famous saying of Dr. McCoy from the original Star Trek Series, "Damn It, Jim, I'm a REALTOR® not a Doctor." A REALTOR® is not a medical expert, scientist, health inspector, or environmental hazard consultant. More importantly, you do not have to be an expert in any of these fields to help your clients better understand mold. However, REALTORS® do need to remain informed on the issues related to mold in order to help the public see past the hysteria and understand the facts.
Mold for Beginners
Molds are a fungus that can grow almost anywhere. It is important for people to remember that mold is a naturally occurring phenomenon. A variety of molds are always present in some minimal level in our homes and outdoor environments. Mold only requires an organic food source and water to grow. Wallpaper, drywall, ceiling tiles, carpets, wood, insulation and other commonly used building materials can serve as an organic food source for mold.
The water source can include leaks from plumbing, poor drainage, defective or improperly installed HVAC equipment, flooding or any other form of water intrusion. Mold does appear to thrive in warm and humid environments that can be found in basements, attics and crawlspaces.
Mold is a problem that is as old as the Bible. Leviticus 14:45 even talks about the dangers of mold in our homes. However, it does appear that attempts to make our homes more energy-efficient may have had the unanticipated consequence of trapping more moisture inside buildings. This may help explain why there were no reported problems in homes or buildings in the United States until the mid-1980's.
It does appear that mold affects people differently and that some individuals may be more sensitive to mold than others. "People with allergies may be more sensitive to molds. People with immune suppression or underlying lung disease are more susceptible to fungal infections." ( Source - National Center for Environmental Health Ð Questions and Answers on Stachybotrys chartarum and other molds).
The scientific community has not been able to determine what levels of mold exposure may pose a danger to our health. Therefore, no one has been able to establish any generally acceptable standards for mold exposure levels.
Mold is everywhere and will never be completely eliminated from any home or building. However, there are a number of things that a homeowner can do to minimize the growth of mold in his home. "The key to mold control is moisture control. It is important to dry water damaged areas and items within 24-48 hours to prevent mold growth." ( Source - U.S. Environmental Protection Agency Ð Mold Resources). Fixing the source of any leaks or water intrusion as soon as possible will also go a long way towards reducing the risk that a home will become infested with mold.
Mold can usually, but not always, be detected by visual inspection or smell. Early warning signs include evidence water stains, mildew and musty odors. However, you should remember that in some cases mold might not be visible if it is growing behind walls, paneling or wallpaper.
What does this mean for REALTORS®¨?
As a REALTOR® you are not an environmental expert but there are a number of steps that you can take to help your clients deal with mold. The first step is education. Explain to the client that the basics about mold:
>That a variety of molds are always present in some level in every house.
>That no house will ever be completely free of mold.
>That it affects people differently.
>That there are no established standards in Virginia for indoor mold levels.
>That everyone in our industry is still learning about mold and trying to sort out the fact from the fiction.
Remind the client that you are not an environmental expert, but that you can refer them to other outside resources that can help them with specific questions. It is always better to refer a client to an outside expert when you don't know all the answers or when the information you have is inconclusive. You may also want to start looking for any experts in our local area who have experience handling mold testing or remediation.
If your buyer is concerned about mold, you should tell them to pay particular attention to any signs of water damage, leaks, mildew or musty odors. I would recommend advising your buyer to have an independent home inspection conducted by a professional. The buyer may also want to consider specialists for inspecting the plumbing, HVAC, and drainage of the property in addition to a general home inspector. You may also want to inform your buyer that while there are no national standards, there are some companies that have begun specializing in mold and indoor air quality testing.
Mold is also quickly becoming an important disclosure issue related to the rental and sale of homes. Keep an eye out for any signs of obvious water damage, leaks, stains, mildew or odors. If you observe any signs of possible mold problems you should disclose this information to all parties. It is dangerous to downplay or ignore these warning signs because they may expose you to increased legal liability. However, one should also avoid reaching premature conclusions or making overreaching statements about "killer mold".
The best course of actions is to note any potential problems, such as signs of water stains, possibly from a leaky pipe - a musty odor was detected, provide a written notice to the client and recommend that they have a qualified specialist check the area to determine if there is a possible problem.
You should also be aware that many insurance carriers have started to revise their homeowner's insurance policies to exclude mold damage. Some carriers have gone as far as refusing to write policies for properties that have water damage or a record of previous mold claims against an insurance policy. As you know this can cause other complications in a real estate transaction if a buyer is unable to obtain an insurance policy to cover the property.
Risk Management for REALTORS®
The personal injury lawyers have been desperately searching for another environmental hazard to replace asbestos as their primary "rainmaker". These are the lawyers who have written articles in legal journals that discuss how "Mold is Gold" for attorneys who are looking for big money lawsuits that they can file in the courts.
REALTORS® should be aware that some of these lawsuits have resulted in substantial awards to plaintiffs. A Time magazine article, reported that "a jury found that Farmers Insurance should pay Melinda Ballard of Dripping Springs, Texas $32 million dollars for mold damage to her 22 room, hilltop mansion and for her ensuing mental anguish...the Delaware Supreme Court upheld a $1 million jury award to Elizabeth Stroot of Wilmington, Del., who claimed that moldy water leaking into the bathroom of her apartment aggravated her asthma and caused cognitive disorders." (Source Ð Beware Toxic Mold, June 24, 2001 by Anita Hamilton) .
Just like in the asbestos lawsuits, the personal injury attorneys will go after anyone involved in mold cases, including REALTORS® who may have participated in any transaction involving a house with mold. However, there are a number of risk management steps that a REALTORS® can take to minimize their legal exposure and protect their clients.
REALTORS® who are property managers can protect themselves and their clients by implementing a preventative maintenance program that regularly checks for leaks, water intrusion or other warning signs of mold as well as periodic inspections of the HVAC equipment. When problem arise from leaks or floods, maintenance people should fix the leak and clean up the area within the first 24-48 hours to reduce the risk of mold growth.
"Tenant education is another way to safeguard against mold claims. Ensuring that tenants know how to avoid creating an environment of mold growth in their homes can go a long way toward reducing your liability if claims are made," according to a piece by Kristen Bradfield in Apartment Finance Today.
REALTORS® acting as listing and buyer agents should remember that proactive disclosure is the best line of defense in minimizing legal liability for mold related claims. As a risk management specialist once told me, "A paper trail of written disclosures is kryptonite to a attorney." A signed, written disclosure serves to document that you advised the client or customer of the concern and may prove to be a lifesaver if a future dispute ever arises.
It is also important that REALTORS® avoid making any judgments or conclusions when possible warning signs of potential mold problems are detected. Refer your clients to outside experts who will be in a better position to identify possible types of mold and their potential health concerns.