Don’t Let Home Buying Contingencies Lapse
A contingency is something that has to be done before another act can proceed. When buying a home, for instance, you have a home inspection contingency as a right – it’s also a form of protection for the buyer. The sales process cannot proceed until the home inspection has been done and the report acted upon. However, sellers are also entitled to a speedy completion of the sales process so home inspections have a ‘use by date’.
If you don’t complete the inspection and act on the report within a certain time frame, you lose that protection and the sale can proceed. This is an important contingency and not one that should not be allowed to lapse, especially since the cost of a home inspection can be insignificant compared to repair costs.
From a buyer’s perspective, do you want to pay for those repairs or have the seller repair them as part of the sales process? There are some areas inside a home that must be in working order. This means that existing appliances, heating, cooling, plumbing, electrical systems and equipment, and smoke and heat detectors should be in normal working order on the day you take possession. These are referred to as ‘walk-through items’ and have to be repaired prior to the buyer taking possession.
Other items that need repair (for example, damaged guttering), can be negotiated with the seller either agreeing to repair, agreeing to a credit on the sales price or declining to repair. In some situations, walk-through items can also be negotiated with the new owner then undertaking the repair. This can be ideal if you want to squeeze a larger credit from the seller and have the repairs completed for a cheaper price.
Don’t let this important contingency lapse. This is often a mistake that buyers make yet by engaging a real estate agent to work on your behalf should never become a problem. They are also in a better position to negotiate a better credit than if you try to do it yourself.
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