Updated: Nov 2
Here I'll be going over various items regarding ratified contracts for buyers.
REIN Offers vs VAR Offers
REIN Offers (Hampton Roads) vs VAR Offers (Typically, but Not Always, Outside Hampton Roads)
Deadlines Caveat - Go by the Contract if Standard Provision Below Not Used
My 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.).
What to Ask Inspectors
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.
There are a number of other potential questions. Here's an article I wrote on the subject.
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:
Images courtesy REIN MLS
Don't send the inspection to your lender:
Please do not send the lender or anyone with the lending firm the home inspection or any version of the repair request.
If you saw the home with another agent instead of Adam, especially over video...
Some of my worst experiences in the business with buyers occur when another agent shows a property to buyers, they assume that the other agent would show them just as many problems as I would, and then the buyers are slack regarding diligently combing over the home inspection and video I send them of my own preview of the property via video. While it's ideal to come to the area for an in person showing, if you don't, it's critical that you take the time to carefully look over the video I send you and the home inspection that the home inspector sends you. Each buyer should carefully look at each item of the inspection and each moment of the video I send in cases of more than 1 buyer. Some of the worst cases of buyer's remorse I've had were when buyers didn't take the time for these critical steps after another agent showed them a property to fill in for me after they had gotten used to my showing style.
VAR Offers w/ inspection contingency:
There are a # of additional possible inspections, and the VAR contract language provides a lot of liberty for the buyer in choosing what kinds of inspections they want to engage in even after the contract has been signed. Examples include 1. Radon inspection tests are unusual in Hampton Roads, but not unusual west of Richmond & Petersburg. Even in zone 3, there is still Radon present. I have spoken to an inspector who found radon to be a problem in at least some properties in Williamsburg even though it's zone 3. I have a radon tester if you'd like a free test, though keep in mind that I have no certifications in the subject.
Images courtesy EPA 2. A mold inspection (different from moisture) 3. A foundation inspection (especially if you see high amounts of settlement/sloped flooring). Keep in mind that if the inspector would also be doing the work, they have a financial incentive to find problems. 4. Chimney inspection 5. Thermal Imaging Inspection (some home inspectors have this capability while others don't; some have it coming standard while others charge extra) 6. Water quantity test (for wells, not to be confused with water quality test) 7. Pool inspection 8. Plumber, electrician, air quality, arborist, roofer, other specialist, etc.
Termite/moisture inspectors if the buyer is supposed to order inspections:
REIN offers: Unless buyers tell me otherwise due to their own preferences, I will reach out to termite/moisture inspectors regarding scheduling
REIN Termite/moisture inspectors if the seller is supposed to order inspections:
You've made your offer stronger by allowing the seller's company to perform the termite/moisture inspection.
VAR offers: The standard contract language of the VAR contract provides that the seller performs the termite inspection, but does not require a moisture inspection. I recommend that we order a moisture inspection, but some home inspectors can do one to kill 2 birds with 1 stone. The moisture inspection should be performed within the timeline of the home inspection.
Septic/well if applicable
If well: Per pg 6, section 17 of the Residential Contract of Purchase, the sellers will be performing a water quality test.
The septic inspection contingency addendum details the septic & well inspection including who chooses it (buyer or seller) & the deadline after ratification.
If well: Per page 8, section C1, & C2 the information on who chooses the well/septic inspector is present as well as who is paying for it. For septic inspections, whether or not it will include pumping the septic is present (& I typically recommend pumping unless it was just pumped).
Other items to note:
Turn in your earnest money deposit asap.
If you'll be turning in a check at Garrett Realty Partners, go here for how to do that.
The check can be turned in any time preferably on day 1 (so that I have time to turn it into the appropriate person) to the front desk between 9-5 on non-holidays and weekends, or through the dropbox (not the white one but the one in the door itself) at the door of Garrett Realty Partners (11864 Canon Blvd. Suite 103, Newport News VA 23606 - not to be confused with Garrett Property Management which is part of the same building but a completely separate office - see map, pictures, and additional info here), but if doing so, please be sure to put it in an envelope labeled "MLS Desk - for (insert property address)"
If you'll be wiring a check, I'll provide the wiring instructions via email.
Some areas by default require a formal solo statement on its own form by the escrow holder of receipt once deposited. That's not local custom by default, but you're welcome to request it & the other side is welcome to request it.
Also, keep in mind that the earnest money deposit is due within typically 2 business days of ratification (the business day after ratification is day 1) to the EMD holder, which is whoever it is made out to (see page 1 paragraph 2 of the standard purchase agreement).
Also, keep in mind that the earnest money deposit is due within the number of days after ratification posted on your offer with no default # (the day after ratification is day 1) to the EMD holder, which is whoever it is made out to (see page 2 paragraph 4 of the residential contract of purchase).
Ensure your contact info & documents associated with the ratified contract are submitted to closing company within 24 hrs of ratification
Order the title search now as long as using a closing company that doesn't charge for title searches if the property doesn't close. Correcting title defects can take a while in some cases if those are present. If they would charge, you may want to wait until after the home inspection before ordering the title search unless a delay for you would be costly in terms of your current living situation. It's unusual for there to be problems with the title, but in some circumstances it happens and some deals fall through because of it.
If Using a Mortgage: Deadline to apply for your loan
It is important to go ahead and apply for the loan within 7 days of contract ratification, as shared on page 2 of the offer.
It is important to go ahead and apply for the loan within 5 business days of contract ratification, (as shared in section 5 A of the offer).
VAR Offers: pay for appraisal within 5 business days of ratification:
It's important to pay for the appraisal within 5 business days of contract ratification (per section 5 A). Once the appraisal is in, be sure to forward it to your agent.
REIN Offers: If inspecting, hold off on appraisal until after agreement made following inspections:
If getting a home inspection &/or other major inspections with an inspection period (excluding seller-ordered/paid inspections like septic/well), don't order the appraisal until after the inspection(s) has been completed. If the home inspection contingency is present, you should authorize and pay for your appraisal within 3 days following the removal of that contingency (per Section 6Ai of page 4).
That is better for negotiation purposes on those repairs. If the appraisal is performed prior to those negotiations, it shows the seller that you are more likely to buy the house regardless of the results of the inspection contingency removal addendum, so a seller has more reason to be stingy when you request repairs since they know that you have, in most cases, invested more money into the house by having the appraisal done. When you send the contract over to the lender, please request that they not order the appraisal yet. Sometimes they will do it without a buyer's authorization once they have the contract, especially lenders that I didn't recommend to you. While those positives exist for waiting, the appraisal timeline is one of the top reasons for delayed closings, especially for closings in <30 days and with certain lenders.
Once the appraisal is in, be sure to forward it to your agent.
REIN Offers: If not performing a home inspection, order the appraisal.
In addition to applying for your loan within 7 days of contract ratification when no home inspection is present, you should also authorize & pay for your appraisal. If you have less than 30 days to close, you'll not want to wait 7 days to order the appraisal. Once the appraisal is in, be sure to forward it to your agent.
Flexible moving plans are ideal.
Owner occupants & investors furnishing properties:
If there are plans that you'd like to make in advance regarding moving, easily cancellable/moveable options at low or no cost for cancellation/moving the dates are ideal. While the closing date is currently fixed to on or before, that date can change and sometimes buyers establish plans too quickly along in the process that can cost them extra time and money to change later.
Current tenants at other properties:
If you are in a lease agreement, weigh the cost of giving your notice of leaving now or later. Items will come up in the home inspection that could deter you from buying entirely, or the seller's response to your requests on it could deter you from buying. Keep in mind that the first monthly payment will likely come around the beginning of the month, with 1 full month skipped, so if you close on the 1st of a month, you could have essentially around 2 months after closing before your first monthly payment (though you may pay some closing costs at closing if the seller isn't paying all). If you close on the 31st of a month, you are looking at closer to a 1 month gap between closing & your initial payment, though your closing costs should be lower. While I don't typically recommend notifying your landlord of your departure now unless a home is <5 years old with minimal visible issues, if you do decide to give notification to your landlord now, I recommend departing your current home 10 days after our scheduled closing if the closing is scheduled for 35 days out or less due to potential delays.
Don't stop searching as long as contingencies remain (i.e. home inspection).
With contingencies present, I generally recommend keeping your eyes out on properties that are hitting the market, lowering in price to be within your criteria, etc. just in case this contract falls through. If you'd prefer for me to disable these search updates at any time, feel free to let me know. If you don't have any contingencies present, you might want to go ahead and deactivate your search. While the contract could fall through, it's unlikely.
Ensure funds will be ready once you need them at closing time.
At closing time you'll need to use certified funds (i.e. cashiers check or wire transfer) and your closing company/lender will be able to detail exactly how much closer to closing time as well as instructions like wiring instructions.
Some institutions & accounts have limits as to how much money you can wire transfer at once or how much money you can get a cashier's check for. In some cases, if you attempt to deposit a cashier's check at a bank, all of the funds won't be ready on the same day.
Some institutions also have some free options for certified funds. For instance, while most accounts at Wells Fargo don't offer it, my "Preferred" account with Wells Fargo (as well as prime checking accounts & premier checking accounts as of 7/1/23, though I don't personally have either of those) has free cashier's checks & money orders. My account with Synchrony Bank, since I've had it for at least 5 years, offers up to 3 free wires per statement cycle.
HOA/Condo Packet Contingency
If you are buying a property in a home owner's association (HOA) or condo association, and you haven't received a packet yet from the association, once that arrives, you'll have 3 days to review it & walk during that timeframe from the contract if we notify the seller in writing via the listing agent about you wanting to pull out. Day 1 starts at 12:00:01 essentially the night after you receive it. The end of day 3 is 12:59:59 PM 2 days after day 1 essentially.
You may be asked to sign an acknowledgement of receipt of the HOA/condo packet initially. That doesn't say that you are fine with the HOA/Condo packet, but simply that you have received the packet.