Home Sellers: Is Your Home Really Sold
When You Sign a Real Estate Contract Offer?
The Home Inspection_Part II
Homeowners like to think that all they need is a signed real estate contract offer and their home is sold, but the truthful answer is maybe yes, maybe no.
The initial post regarding a real estate contract offer to sell your home talked about the Attorney Review Clause. In this post we will review the Home Inspection and the possible stumbling blocks the home inspection may create in moving a real estate contract forward.
The home inspection will consist of a structural inspection, termite inspection and more often than not a radon inspection. Additional inspections which may be required involve well water testing and an underground oil tank scan. While the purchaser pays for the home inspection, New Jersey State Law requires the testing of well water in the sale of residential real estate, and that expense is the sellers responsibility.
The purchaser generally orders their home inspection upon conclusion of Attorney Review. The reason for that is the contract of sale is not binding until completion of Attorney Review. As previously discussed in the prior post on the topic of real estate offers, during Attorney Review the contract of sale can be cancelled by either party and a purchaser would be more prudent waiting until completion of Attorney Review before spending money for the home inspection.
Depending on the size and age of the home, the home inspection will take between one and a half hours to two and a half hours. All utilities must be on for the inspection and it is not necessary that the homeowner be present. More often than not the home inspector will be accompanied by the buyer and the selling real estate agent. However, not all selling agents agree with that thinking and do not attend the inspection. I also believe an additional responsibility of the listing agent is attending the home inspection, but not all listing agents agree with that and do not attend the home inspection.
The home inspection is very thorough. The inspector generally starts with the exterior, then the basement and continues throughout the complete interior. The exterior and roof are inspected, all mechanical systems are turned on and checked, plumbing is checked, windows opened and closed, attic inspected and everything else related to the condition and structure of the home is inspected.
The home inspection also includes a termite inspection. Many home inspection companies are licensed to inspect for termites and provide the termite inspection. There are other inspection companies who arrange to have a Termite Company perform the termite inspection. There is a difference between a Termite Inspection license and a Termite Company License, but that is another topic. In either case, the Termite Inspection Fee is generally included in the Home Inspection Fee.
The home inspector will also leave a radon canister in the basement and make arrangements to pick up the canister in two/three days to then send to a testing company. The results are then provided to the purchaser in a week or so.
The Summer season can be a concern for home sellers regarding the radon test and homes without air conditioning. It is important that basement windows are closed at least one day before the radon canister is placed in the basement. Likewise, if there is not a basement, the radon canister will be left in the home and the windows in the living area must also be kept closed at least one day before the inspection and kept closed during the testing period.
Upon conclusion of the home inspection, most purchasers have a feel that they are satisfied with the inspection and then wait to receive the written inspection report to then make repair requests of the owner through their Attorney in accordance with the contract of sale. However, there are instances where the inspection revealed much more than the buyer anticipated and or revealed major problems with the home. In instances like this, the purchaser will then advise their Attorney that they will not proceed in accordance with the terms of the contract of sale. In either situation, the terms of the contract of sale and addendums approved by the Attorneys during Attorney Review may dictate what the purchaser can actually request and whether or not they have the ability to cancel the contract unilaterally.
More often than not, purchasers are generally pleased with the Home Inspection, but do request that the seller repair and or take care of issues or repairs that the inspection revealed.
However, a more difficult aspect to resolve with home inspection issues involve those items that are beyond their economic life and will need updating or replacement shortly. These are items such as the age of the roof, furnace, hot water and electrical service, components of the home that are either old and or have outlived their economic life. And they become an issue when the purchaser was not aware of the age of these items when they negotiated the contract offer and may not have been aware that items like these would need replacement in the near future.
Yes, resolving home inspection issues can be a stumbling block in moving a real estate transaction forward to the next step, the purchaser’s mortgage application and the home appraisal.
The above article,“You Signed a Contract Offer to Sell Your Home, the Home Inspection”, was written by David Fialk, REALTOR, Broker Owner, Choice Realty Co., Iselin, New Jersey and regularly posts real estate articles of interest for home buyers, home sellers and home owners.
Licensed since 1971, David has helped over 1800 families move across town, across the state and across the country and specializes in the towns of Iselin, Colonia, Edison, Woodbridge, Avenel, Fords, Sewaren, Port Reading, Keasbey, Carteret and Metuchen in Middlesex County, New Jersey.
Planning on purchasing real estate? Thinking of selling your home? For real estate information ”You Can Rely On, Contact the REALTOR You Can Rely On”.