Who is responsible for repairs during a home sale?

SAN DIEGO COUNTY – Many questions can arise during the home-buying process. Buyers looking at homes that require a good deal of TLC may wonder who is responsible for the home’s repairs, particularly if such repairs are needed to meet lender’s requirements. Depending on the situation, there is no clear-cut answer.

There is no perfect home, and things that are acceptable to the current owner may not be acceptable to the buyer who is looking to become the next owner.

The home-buying process is typically a careful cooperation between buyer and seller to find middle ground. The buyer may have to make some concessions, as will the seller. Ultimately, it is this cooperation that often determines if the sale goes through or is terminated.

Before any negotiations can begin regarding repairs, it is advisable for a buyer to have an independent inspector come out and look over the home and property. Most real estate agents will suggest this be done as a first priority – even before a contract is entered on the home.

An inspection can unveil potential problems in a home and bring attention to things that the buyer may not be aware of, including items that do not meet county code or could be unsafe.

An inspector also may point out problems that could cause a mortgage lender to give pause. This may mean the lender will deem problems unsafe and refuse to fund the mortgage until repairs are made.

A copy of this inspection report should be sent to the home seller to review with his or her real estate agent and attorney if need be.

The buyer working with his own real estate agent or attorney can petition for certain repairs to be made.

Many sellers will make such repairs to ensure the purchase goes through, or they will accept a lower purchase price to compensate for the needed repairs, which the buyer will then make.

Whichever option is agreed upon should be clearly stated in the property purchase agreement.

Customary procedures often change when buying a home that is a short sale or in foreclosure. A home that is in distress is typically in this situation because the current owners cannot afford to pay their mortgage, and as a result, are not able to afford repairs. According to Kelly Crews, a local real estate broker, buyers may try to negotiate repairs with the seller, but they shouldn’t assume that sellers (or lenders in the event of a bank-owned home) are responsible for the repairs. Generally speaking, most short sales and foreclosures are sold “as is” and may even specify that repairs and requirements for the certificate of occupancy are the buyer’s responsibility. A buyer also can ask to have the home price reduced to cover the repairs. But foreclosures are often already deeply discounted.

The most important consideration in selling or purchasing a home is to use a well-experienced real estate professional who looks after their client’s best interest.