What Homebuyers Need to Know About Property Inspection

What Homebuyers Need to Know About Property Inspection

No matter how in love you are with a house you want to buy, you should never forego a property inspection. What you saw as you toured the house could hide some very expensive things you didn’t see, and only a professional property inspection will give you a true picture of your potential purchase.

Here are some of the most important things homebuyers need to know about property inspections:

“As is” clause. A seller may want to avoid paying for repairs by including an “as is” clause in the contract. While a buyer will still have the opportunity to inspect the property, the seller has already put you on notice that anything you find, you fix. If there are major repairs that need to be done, the buyer has the right to cancel the contract.

Capping costs. The seller is generally obligated to spend a certain amount or percentage of the sales price to fix any defects or damages found during the inspection. A seller may try to limit the amount he or she will have to pay by capping the amount in the contract.

Deadline. Sellers usually include a deadline by which the buyer has to conduct his or her inspection of the property. Buyers will want the deadline to follow after the financing contingency is met, but should set the deadline far enough in advance of the closing date to prevent any last minute issues.

Repair timing. If repairs are necessary, the buyer and seller may agree to extend the closing date or could decide to put funds into escrow for repairs made at a later date. Buyers may want to choose the latter option, since it gives more control over how the repairs are made.

Working condition. Property inspection reports typically include all need repairs, some of which may not be the seller’s responsibility. To avoid delay or disagreement over these, some contracts include an inspection clause requiring the seller to deliver items in working condition.

Exceeding the cap. If the cost to repair items noted on an inspection report exceeds the cap set for the seller, either the buyer or seller can cancel the contract or agree to pay the additional cost.

Lender requirements. If the purchase is being financed, the lender will usually require the buyer to provide an inspection report and may require any necessary repairs be made prior to closing.

Jurado & Farshchian, P.L. assists both buyers and sellers with real estate transactions and questions. Please call one of our experienced real estate attorneys at (305) 921-0440, or email us at info@jflawfirm.com today.

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