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Don't Bring Dad to the Home Inspection.

Nothing will be good enough for Daddy's little (insert pronoun here). We get it, this is probably the most expensive thing you've ever bought - and you definitely don't want to get into something that is just going to be a sink hole. We don't want that for you either. Realtors have a fiduciary duty to act in their client's best interest, if the house has some hidden issues we can terminate the contract and get your earnest money back. That's why God made option periods. Let's get real about option periods and property inspections.

So what is an option period and what happens in that time? An option period is a negotiated amount of time (usually between 3-7 days) for which the buyer pays a fee (usually a couple hundred dollars) for the unrestricted right, or option, to terminate the contract for any reason and get your earnest money back.

During this time, we recommend that you, as a buyer, get a home inspection and allow us to negotiate any resulting repairs. Are you required to have an inspection? No, but we strongly recommend it. Home inspectors are not made equally - I have had clients insist on hiring a friend and have seen them come back with an absolutely clean inspection, super suspect. Not even brand new homes have completely clean inspections (btw, new construction properties need to be inspected too, things get overlooked). Let us recommend some tried and true inspectors who will go over your home with a fine tooth comb. Inspections usually cost between $350-$500, pool inspections and septic systems might cost a bit more. Luxury properties usually cost a bit more too - it is based on square footage and features.

Some things to remember when looking at your inspection report: Just because it is marked "deficient" doesn't mean it's broken. Inspections are done to current day code. This means, if the property you have under contract was built in the 1960's and everything was built to 1960's code, everything may be in perfect working order and not in need of repairs, but might get flagged anyway. Another thing to consider is the gravity and costs of certain repairs. There are major systems like the electrical, plumbing, HVAC and structural items like foundation and roof that could be quite costly. Smaller items like GFCI outlets and caulking don't cost much at all. Another thing we see on almost all inspections is inadequate drainage. Ideally the earth around the foundation is supposed to slope away from the house, to carry water off so it doesn't pool around the house. We can chat about foundations in another post. If an important system is flagged in the inspection report, we will get a specific inspector or contractor to look at the item more throughly.

Negotiating repairs: Certain types of loans (FHA & VA mainly) might require specific items to be done before closing, but generally we like to negotiate a concession for you in lieu of repairs. This method is mutually beneficial for both parties. The seller doesn't have to come out of pocket and scramble around with handymen and contractors. The buyer can pick their own contractor, do it themselves, or take the money and apply it to something else. Otherwise there really is no motivation for a seller to make sure the repair is done correctly, just cheaply. We recommend taking care of things after close, at your convenience. This negotiated concession gets credited to you at the closing table, and is that much less you have to bring with you at closing.

MM - 5/2022

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