What if the home inspection turns up problems?
The forms we use at the Lake of the Ozarks gives the buyer two options to ask for after they have reviewed the inspection and decided their course of action. The two choices are:
- Buyer is satisfied with all inspections. Delivery of inspection reports is not required.
(Contingency is resolved)
- Buyer requests satisfaction of the following unacceptable conditions, and/or a monetary adjustment be
provided at Closing as specified below. A complete copy of the inspection report(s) is provided
Ask for a credit for the work to be done
If the property is moving toward closing and the last thing they want to do is repair work on their old home. As a result, they may not approach the work with the same conscientiousness that you, as the new owner, would. They may not even treat the work as a high priority. If you take a cash-back credit at close of escrow, you can use that money to complete the project yourself. Chances are you may do a better job than the seller, too. Finally, if you get the credit, there will be less back and forth to confirm the work has been done
Think long term
If you know you want to renovate a bathroom within a few years, then you likely won’t care that a little bit of its floor is damaged, that there’s a leaky faucet or that the caulking needs to be redone. These things will get fixed during your future renovation. However, the repairs are still up for negotiation. Asking the seller for a credit to fix these issues will help offset some of your closing costs
Watch what you say to the inspector
Revealing your comfort level with the home or your intentions, in the presence of anyone other than your buyer’s agent could come back to haunt you in further discussions or negotiations.
For example, if you mention you’re planning a gut renovation of the kitchen, the sellers will certainly hear about it. And they’re going to be less likely to offer you a credit back to repair the appliances.
Buyers tend to grossly overestimate repair costs
Buyers overestimate by a wide margin what repairs will cost. Trust an experienced agent such as John Garrett to know local prices on labor and goods. John has flipped, rented, and owned many properties at the Lake of the Ozarks, he has likely done the same remodel or repair that you are considering and has a great idea what it will cost. He can get you bids from reputable contractors as well. Throwing a repair bill that is 35% higher than it should be will only serve to upset the seller and make them less negotiable. The whole sale process will often collapse at this point. Be REASONABLE and accurate.