After the Home Inspection
Every offer to buy a home should contain a repair contingency that clearly outlines the buyers and seller's responsibilities if repair issues result from the home inspection.
In New Jersey, the usual contract specifies that the property is being sold in "as-is" condition. The seller is required to disclose any "known conditions". The usual source for this information is the "Home Seller's Disclosure", which should be examined before an offer to purchase is made.
In order to protect the buyer from undiscovered conditions, the buyer is granted the right to a home inspection, at his own expense, by a 'qualified inspector" prior to closing the sale. The purpose of this inspection is to determine the existance of any undisclosed physical defects or environmental conditions that may affect the property. There is usually a timeframe within which the inspection must be perfromed, and an additional limit on the amount of time the buyer has to submit any issues found for consideration by the seller.
If a serious condition is discovered, the seller can: 1. Repair the condition. 2. Offer the buyer a lump sum at closing. 3. Prepay for a repair to take place after closing. 4. May escrow monies to be used to make the repair after closing. 5. Refuse to address any repairs.
If the extent of the repairs are of a serious or hazardous nature and the seller refuses to address them, the buyer may decalre the contract "null and void", and all monies deposited to that point should be returned promptly.
The usual remedy actually involves negotiations that may include repair of some items, monetary consideration for some conditions, and possibly refusal to address others that may be considered trivial or obvious to the buyer at the time of the offer.
It should also be noted that unless a buyer makes unrealistic demands, discovered repairs become a material fact and must be disclosed to all future potential buyers. It is therefore in the seller's best interest to address any serious conditions. Further, certain conditions can cause a problem with lenders, and may cause a lender to refuse to lend on the property until repairs are made.
If a seller makes repairs prior to closing, it is advisable to have the home inspector revisit the property to verify the repairs. It is not wise to wait until the final walk-thru to verify repairs because the day of closing is hectic enough without having to raise repair issues.
In addition, it should be noted that if a condition was "obvious", and the buyer made a low offer which was accepted, the seller may conclude that the condition was known to the buyer, and formed the basis of the buyer's lower offer. Further remedial action may therefore be refused.
Buyer's should consult with their attorney to make sure they are protected in any situation where repairs are to be made after closing.
|
