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Old 08-18-2008, 02:05 PM
 
811 posts, read 3,973,305 times
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Hi,

I was wondering whether repairs that may come to the surface after the home inspection takes place, are covered by seller alone.

OR

are the expenses of covering repairs usually negotiated by both seller and buyer??? What should be the strategy here, if lets say, major faults are found in the property and cost a whole lot??
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Old 08-18-2008, 02:08 PM
 
Location: Charleston Sc and Western NC
9,274 posts, read 23,395,644 times
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It's usually another negotiating process to cover cost of repairs. Usually the best case scenerio would be to split the cost of a major repair. But honestly if it's something like a foundation.......walk away. If a house fails an inspection in a major way, you loose nothing but your time.

Electrical service upgrade is usually as standard in Houston and most sellers will cover or split that with you. Some sellers will pay for nothing if you nit pick.
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Old 08-18-2008, 02:11 PM
 
Location: Athens, GA
76 posts, read 375,535 times
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If you have already entered into a Contract for Sale of Real Estate and you had an inspection done on your own, the seller is not obligated to pay for any repairs noted by the inspector unless the Contract specifies that the Seller will pay for the repairs.
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Old 08-18-2008, 02:18 PM
 
Location: Houston
57 posts, read 384,601 times
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Generally, any repairs found by the inspection process are a point for negotiation. It is common to put into a contract language like "seller will make repairs as needed after inspection up to a maximum of $xxxx" That way the seller knows what to expect if he agrees to the purchase price. I have put language like that in contracts, along with an out for me as a buyer if "needed repairs" run over some amount. Just in case something major is found and the seller won't repair it.

In the end, there's no real definition of "needed" repair, so it becomes negotiable.

Although the seller does not have to agree to repairs - any major conditions have to be disclosed to potential buyers from that point out. So if you find a big hole in the water line, for example, the seller will probably fix that since he will have to disclose that to future buyers. There's little chance of getting another buyer to make an offer until the hole is repaired.

If I were in that position and ran in to a MAJOR repair need, I'd make it clear it needed to be repaired or I would walk away. If the seller refused, I'd make it clear to the listing realtor that I expected the disclosure document to be updated to reflect the condition.

However, so long as a condition is disclosed, I don't believe the seller has to fix it.

At least, this matches my experience. Hope it helps.
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Old 08-18-2008, 02:20 PM
 
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Georgiagirl2,

I haven't signed the contract yet. The contract does not specify that the seller will cover all the costs. I talked to the seller, and according to the seller we'll end up negotiating about the cost of repairs.

Does that usually work out smoothly between the two parties or is it a big pain to deal with? From what I know and people tell me, the home inspector will definitely find faults within the property since thats his job. My concern however, is that hopefully the faults wont be too MAJOR and expensive for us.
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Old 08-18-2008, 02:36 PM
 
Location: Athens, GA
76 posts, read 375,535 times
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Quote:
Originally Posted by marykate1 View Post
Georgiagirl2,

I haven't signed the contract yet. The contract does not specify that the seller will cover all the costs. I talked to the seller, and according to the seller we'll end up negotiating about the cost of repairs.

Does that usually work out smoothly between the two parties or is it a big pain to deal with? From what I know and people tell me, the home inspector will definitely find faults within the property since thats his job. My concern however, is that hopefully the faults wont be too MAJOR and expensive for us.
I would have a clause added to the sales contract allowing you to have this home inspection done. Also, add a clause stating that the seller will pay up to $____ for any repairs required as a result of the inspection, as well as a clause stating that should the repairs exceed the amount agreed to by the seller, then the buyer has the option of paying the difference or the option of rendering the transaction null and void with all earnest money deposit fully refundable. As the buyer, you should pay the cost of the inspection fee so that you are free to choose your own inspector.
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Old 08-18-2008, 02:38 PM
 
Location: A little suburb of Houston
3,702 posts, read 16,330,595 times
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What does your contract say? What everyone else said has some bearing but only if you put it in your contract. That is what contingencies are for. The contract spells out the responsibilities of the parties involved. You state that you spoke to the seller and she said you will end up negotiating...where in the contract does it say that? You can very well ask her to repair something, but unless your contract requires it, she can say no. For that matter, if your contract does not have language that allows you to inspect and cancel for defects (be specific) found upon inspection, it may not matter what you find during the inspection...you will be stuck either way. I will keep repeating this...you really need a representative.
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Old 08-18-2008, 02:47 PM
 
Location: Athens, GA
76 posts, read 375,535 times
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Quote:
Originally Posted by Poltracker View Post
What does your contract say? What everyone else said has some bearing but only if you put it in your contract. That is what contingencies are for. The contract spells out the responsibilities of the parties involved. You state that you spoke to the seller and she said you will end up negotiating...where in the contract does it say that? You can very well ask her to repair something, but unless your contract requires it, she can say no. For that matter, if your contract does not have language that allows you to inspect and cancel for defects (be specific) found upon inspection, it may not matter what you find during the inspection...you will be stuck either way. I will keep repeating this...you really need a representative.
True, nothing should be done until the contract is signed with the provisions or clauses I suggested in my prior post.
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Old 08-18-2008, 02:58 PM
 
Location: Katy, TX
1,288 posts, read 4,473,029 times
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I thought this was what the 10 day "option" period was for here in Texas. At least that's what our realtor told us, we got our inspection done right away and the sellers had to tell us what they would do before the option ran out. Our realtor said during the option we could walk away for any reason, but after the option we pretty much were stuck.

What pissed us off was the sellers took until the day the option expired to acknowledge the inspection items and sign the contract...and what ended up happening is our realtor wasn't quite specific enough in her language on addressing the AC unit (having someone "service" it in the end meant nothing) so we pretty much had to live with it. On the other hand, there have been delays in fixing the sidewalk they promised to fix and if they don't get it done by Wed we will demand a credit or hold up settlement...that would be them not holding up their end of the contract.
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Old 08-18-2008, 03:03 PM
 
Location: Houston
57 posts, read 384,601 times
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when you do put in a contract, you will probably use a standard form. I think it's TREC-20 or something. Your realtor will know. I think a standard provision of the current revision is a "Termination Option". It will be in its own paragraph, clearly labeled. That allows you to pay a nominal fee (say, $100) that the seller gets to keep NO MATTER WHAT. However, it allows you a few days to back out for any reason whatsoever, period, without losing your earnest money. If you use those few days wisely, it can give you a lot of peace of mind.
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