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What Happens When a Home Inspection Doesn’t Go According To Plan?
Someone sells a home. Someone offers to buy it. In between the time the offer is made and the house is officially sold, the person buying the house asks for a period of “due diligence.” That’s just a fancy way of saying that the buyer needs to do some homework. The most common part of this due diligence is a thorough home inspection, where the buyer hires an independent, qualified home inspector to examine the property from roof to foundation looking for any potential issues that would be important to know before a sale can go through. If the home inspection report comes back with problems, typically a buyer and seller work together to find ways to keep the sale alive. Here are the three most common ways the two parties can work together.
REPAIRS TO BE MADE BY SELLER
In this scenario, the buyer and seller look at the home inspection report and the seller agrees to fix things that needs to be addressed. It may create out-of-pocket expenses for the seller, but it immediately address the items in question, usually on a mutually agreed upon timeline, and may not affect the original terms of the deal.
PURCHASE PRICE REDUCTION
In this scenario, the buyer and seller mutually agree to reduce the sale price of the home in lieu of doing repairs or credit. This is pretty straightforward for all parties.
CLOSING COST CREDIT
In this scenario, the seller may agree to kick in and cover some of the buyer’s costs. Think of it this way: it costs a lot for a buyer to get a loan and close on a house, so the seller agrees to cover some of those costs, and those are paid at the time of closing. This can be a good alternative for sellers who don’t want to pay money out of pocket for repairs, and it also helps the buyer lower the expenses involved in buying their home.
There is no “one size fits all” remedy for home inspections with surprises. Some buyers or sellers may not be big into DIY, while others would much rather tackle the projects themselves. Money, time, skills, and negotiation style all play a role. Should anything come up that needs a specific service professional or educated opinion, working with an agent who can provide references or manage this process for you will allow you to focus on the more fun parts of buying a house.
Our SunCrest Market Update is a hyper-local analysis of the most up-to-date information regarding the SunCrest real estate market. The previous month’s SunCrest housing information and future editions are released monthly.