You have just finished going over the Home Inspection report with your Inspector. Now what do you do with the information they have provided you? Typically, most buyers sit down with their Realtor® and go over the report again, item by item. It is very important for you to fully read and understand the report you paid for. There are often items that could have a significant financial impact. The Realtor® will work out a "request for repairs" letter to send to the seller's Realtor®, stating what you want repaired or how much "credit" to correct the defects found after the sale.
What do you ask for? How much should you ask the seller to credit you? Should you have them repair or do it your self? When do you want it done?
All tough questions! Of course, if you have a good professional representing you, it will go a little more smoothly.
There are obviously many deciding factors here:
* How "tight" is the market in this area?
* Is there any "wiggle" room for the seller in the deal?
* Do you trust the seller to do proper repairs and not just quickie them?
* Do you even have a clue what the repairs will cost? This is too big a purchase to guess.
* Should the repairs be completed before escrow closes of after?
* How will repairs after escrow be paid for?
I can make a few suggestions that could help. If the deal is tight, consider cutting a deal with the seller and when asking for a repair, offer to split it with them.
Get estimates for repairs from those supplemental inspectors the report probably called for. They are the ones that can tell you what something will cost since they are trying to get the job. Also, having a bid from a professional takes guessing out of the picture and gives credence the amount you are asking in credits.
I council my clients to take a credit and handle the repairs with their own people so they can control the quality better.
Depending on the extent of the repairs being asked for you can accept the bids from the contractors for smaller jobs up to a few thousand in most cases as the amount you ask for.
More extensive repairs often uncover other, concealed defects that will cost more to fix. Large jobs seldom come in on budget due to this issue. If you settled for the bid price, you could end up eating a larger chunk than you had planned on. A good argument for having the seller take responsibility for the repairs.
Most of the escrows I see are 30-60 days. This is often enough time to complete small repairs. Unless your escrow is much longer, I would leave the larger repairs till after escrow and use a contract with the seller to secure the payment for them. Just put the money in an escrow account to guarantee the money will be there when needed.
So, there is a way to intelligently handle these potentially troublesome issues in a straight forward manner. A Realtor® Professional is there to guide you through this. Make them earn their money!
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