Buyer Ratified Contract! Now What?
Updated: May 2
This post is a supplement to my email to buyers who have ratified a contract, going through a number of situations that apply to most buyers. My email will have additional information such as inspector options to choose from. Any deadlines below are for typical REIN or VAR contracts, though keep in mind that many items can be struck on contracts so if that was the case, or if a number was input in a location that had a different default number, go by the contract, not the deadlines listed below. Page references and locations are listed below to help you match things up with the contract.
Inspection items to note:
Available inspectors providing reports a low time following inspections is ideal:
The timing of when an inspector can inspect & provide the report, even within the period for the inspection that we have set, can mean the difference between closing on time or not for closings scheduled <35 days out (& in some cases <45 days out) from ratification. In light of that, keep in mind that a $200 savings for the inspector used, or a desire to be at the closing if it would delay the date, can mean, in some cases, a >$1k difference in costs if a delayed closing would be costly for your situation (i.e. needing to move things twice if using movers, paying for storage, etc.).
If you'll be there, what to bring & how you may want to participate:
If you are available, it's generally a good idea to be present at inspections, although the home inspection is more important than the termite/moisture inspection.
With the home inspection, it's a best practice to bring a fold-up chair whether vacant or furnished. It's also not a bad idea to bring a laptop or tablet in case you get bored & want something more effective than a phone for work, entertainment, or otherwise. It's not a bad idea to bring a fold up table as well. In all 3 cases, I have spares available by advance request if you'd like me to bring one or a few.
Prior to the inspection, it's not a bad idea to ask the inspector if they are going to test "all" outlets, light switches, & smoke alarms/detectors. If they won't, it's a good idea to test all of them yourself, & can often be done without much industry knowledge, with any difficult possibilities assisted by inspectors. I have a simple 3-prong outlet tester available and the inspector should have at least 1 as well. I also have a ladder available for most smoke alarms beyond reach. While I typically bring the ladder that I have available with me at every property showing, if you'd like me to bring a bigger one or an attachment for my 30' Doca pole to push the button on a smoke detector, (i.e. for 2-story ceilings in rooms with smoke detectors on the ceiling) let me know.
There will be certain issues that are beyond the scope of the inspection. Painting defects are a common example. It's a good idea to be aware of those issues beyond the scope of the inspection in advance so that you can focus on those items more so than you did in your initial showing during the inspection so that you're more aware of them. These aren't typically the kinds of things that you'd ask for in a home inspection contingency addendum even if they were plentiful & you didn't notice any before, but it's still a good idea to have them in mind regarding what you're getting into.
During the inspection, some buyers like to be with the inspector at all times, while others like to explore the home further on their own.
The inspector's primary findings will be on a report, typically including pictures.
Inspector mistakes & my release of liability regarding your inspector choices:
No inspector is perfect, & some items in inspections will be missed. Missed items especially due to gross negligence of the home inspector can at times be covered by the inspector out of the proceeds of what you paid them, but typically not any amount above. I am giving advice on inspectors with the assumption that you understand that even the best inspectors from personal experience of mine and from online reviews can have bad days. In some cases companies that I have used in the past are ones that I no longer use based on my experiences or what I have heard firsthand from others, including my buyers. My principal broker shared a horror story of how a buyer once held him personally financially responsible for perceived inspector negligence to the tune of thousands when in no way was my broker negligent even if the inspector may have been on that day. If you would hold me to that level of liability, it would be best for you to pick your own inspector, but I am assuming that you would not while assuming that you would share with me any concerns that you have with anyone I ever recommend. While I don't recommend it (due to cost, time, etc.), another way to limit the amount of missed items is to get more than one inspector independently. Also keep in mind that any of my notes on inspectors and other service providers may be my opinion if I make generalizing statements, & I sometimes mention negatives in those notes since no inspector is perfect. Especially repeat buyers sometimes have certain preferences about inspectors and inspection types (i.e. buyers that prefer to include a thermal imaging inspection or buyers that prefer to include model numbers of all appliances). If you have certain specific expectations about the inspection, please let me know. I am not assuming any add ons to your inspection to conserve your costs. The home inspector should produce a written contract clearly specifying the terms, conditions, limitations, & exclusions of the work to be performed.
What to expect upon receipt of the home inspection & what to request once you receive the inspection:
While the home inspection report typically has dozens of items (excluding new construction) that will be problematic with the house, unless there are 15 items or less (or if a property is new construction), to request all items is typically seen as an overbearing request, and even if there are 15 items or less, some items can still be perceived as trying to take advantage of the seller, such as asking for a replacement driveway when there are only minor settlement cracks that were clearly visible prior to the home inspection. With the items to remove, it's good to focus on those items that you could do yourself in a low amount of time at a low cost or things that you wouldn't do at all that don't impact function & wouldn't deteriorate further quickly if left unabated. Also if you were planning on changing things up anyways, it can be good to skip some items, such as if there are some floor tiles missing on a floor you were planning on replacing anyways. Anything that was obvious prior to the inspection, especially that which is primarily cosmetic, can also be perceived negatively by the seller, but in some cases those requests can still be good. Things to routinely request include any wood rot that the termite/moisture inspection isn't requesting, any inoperable appliances, any leaks, any main systems that aren't functioning properly, etc. Inspections typically will have the most important items in a single section or will designate them as matters that the inspector believes are urgent/important. Requesting too much can backfire. A seller that I was representing would have agreed to more if the buyer had asked for a more “reasonable” request than asking for too high of a number of inspection items to be corrected or a drastic price reduction to occur. The sellers felt like the buyer was looking to take advantage of them and went against my advice in some capacities about how they responded because they were insulted. Thankfully the buyers agreed (with around 5% of their original request) & the transaction was saved, but it just goes to show you what's possible.
Here's how that form looks: