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Request for Repairs - Avoiding this major deal killer

Request for Repairs - Avoiding this major deal killer!

Updated:             May 30, 2018

The ‘request for repairs”, occurring after inspections have occurred but prior to all contingencies being removed, can become a major hurdle to completing the transaction. This re-negotiation of a contract after several weeks has elapsed can result in, at best, both sides a bit resentful and at worst, a cancellation of the contract.

To further complicate the transaction, the lender is often instructed to wait for the inspections to be completed prior to ordering the appraisal. During robust markets and lengthy appraisal time frames, this delay can be fatal to lock in periods and can interfere with meeting closing deadlines. 

One remedy to this situation is for the seller to acquire a home inspection and pest control report when preparing to sell. Having these two reports available when an acceptable offer is made allows a prospective borrower to quickly determine if the condition of the property is an issue in proceeding to purchase. The seller’s investment of $500 - $700 upfront may allow both parties to either eliminate any need for future repairs or to quickly address any required re-negotiation surrounding the property’s condition.

Obviously there are times when circumstances suggest at least postponing the acquisition of these reports in advance - short sales or other cases where there is a lack of sufficient equity or cases of distressed property in which the condition is of little concern to a cash buyer.

But many sellers may not recognize the value of providing reports wherein the transaction may move more smoothly and timely and even allow for the negotiation of a win-win price for everyone, especially when a buyer feels that there has been “full disclosure”. In other words, a home inspection report, even if there are repairs to be made, allows an estimated cost to be factored into the buyer’s offer. A pest report may be acceptable to the buyer because s/he recognizes that the repairs are manageable.  If the roof is older or shows signs of wear, a roof inspection may reassure a buyer or identify what new roof will cost allowing the buyer to proceed with an offer.

Instead of viewing these reports as deal-breakers, they are more likely to create a buyer confidence that will lead to an acceptable offer to purchase. Providing such reports could be the best investment the seller will make in preparing a home for sale. 

 

 

Word/lending info/request for repairs