Home Inspections–What You Should Know
The buyer’s home inspection is one of the many steps involved in selling a home, that by its nature, pits buyer against seller. No seller wants to be faced with a lengthy, and often, expensive list of repairs. No buyer wants to purchase a potential money pit.
Sellers should be prepared for the news that in a buyer’s market, buyers clearly ask for more repairs than they would have ask for a couple of years ago. Sellers need to understand that it is critical to separate the emotional or insulting nature of an inspection report from the transaction itself. And, although objectivity is a difficult task to master, seller’s should always be calm, never angry, when responding to the buyer.
Seller’s need remind themselves that the inspector works for the buyer. It is the inspector’s job to document a large list of items that may cost the buyer money down the road. This doesn’t mean the inspector thinks your home is a piece of trash or that you don’t maintain it. They are simply noting items about your home that may need attention.
So, what should the seller do after they receive a list of repair requests? Although state laws regarding inspections and repairs differ slightly, most sellers have three options.
- You can accept the entire repair request list.
- You can decline the entire repair request list.
- You can agree to part of the repair request list.
Each of the three options have a potential effect on the transaction.
If you accept the entire repair list, the deal moves forward and proceeds ultimately to the closing table. Keep in mind you have to make the requested repairs and the buyer will do a walk thru before closing to make sure the repairs are acceptable. Don’t try to save a little money by doing the work yourself, if you aren’t confident in the outcome of the job.
If you decline to make any repairs on the list, the buyer can accept the house in “as is” condition. Or, they can cancel the contract and get their earnest money refunded.
If you agree to fix some, but not all, items on the list, the buyer can cancel the contract and get their earnest money back. Or, accept the repairs you have agreed to do and proceed to closing.
Note: As a general rule, repair request negotiations are one-time affairs. They do not go back and forth with an offer and counter offer. Repair requests do not involve other terms of the contract such as price, closing date, etc.
Tomorrow, I will address what items on a repair list are reasonable requests and which should be declined. If you have an specific issues, please leave a comment in section below.
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