As a real estate buyer, you may be anxious to wrap things up and close on a property. The process can be long and arduous. Finalizing the deal is likely something you are looking forward to with great anticipation. Don’t let the rush to the finish line prevent you from taking important steps to make sure you are protecting your best interests and getting a favorable deal from the whole transaction. One important step, for instance, that you should take care to be especially mindful of, includes negotiating repairs after a home inspection.
Tips for Negotiating Repairs After a Home Inspection
The purchases of most residential real estate involve a home inspection prior to close. As a licensed professional, a home appraiser evaluates the ins and outs of a property and highlights any aspects of the property that are not up to code or may need repair or replacement now or in the near future. Once the home inspector issues a report detailing the findings of the inspection, the home buyer will usually make requests for repairs or price reductions based on the inspection report.
The negotiating after a home inspection is rather standard and should come as no surprise to any party involved in the transaction. It should, however, be handled with care. For example, you should enter negotiations armed with a list of your priorities. Are there aspects of the report that would cause you to walk away from the whole deal if not addressed by the seller? Prioritize these things. Home inspections can reveal issues big and small, ranging from needing a new roof to a leaky faucet. Some you will need to insist on being resolved and others you may consider addressing yourself after the purchase is completed.
Once you have identified your non-negotiable, major items to be addressed prior to closing, prepare yourself for requesting the appropriate concessions. You may want to request that the issues be repaired by the buyer. Alternatively, you can request a proportional reduction in the sale price or a cash credit at closing, if permitted by your lender. With a cash credit arrangement, the seller refunds a portion of the sale proceeds. Usually, a reduction of the sale price is the preferred and most expeditious method of addressing such issues prior to closing.
When approaching these negotiations, it is important to maintain reasonable expectations and take important factors into consideration, such as the real estate market. In a seller’s market, you as the buyer are not likely to be in the strongest negotiating position as the seller is much more likely to be able to easily move on to another buyer who is less demanding and more reasonable. Try and keep perspective on things like this and take the time to view the transaction from the seller’s point of view.
If negotiations are not working out, know when it’s the time to walk away from the whole deal. It can be disappointing, but if your deal breakers are not being accepted into the agreement, then you need to be able to recognize that this is not something you want to continue to pursue.