Posted on: 13 August 2015
Before closing the sale on your new home, you have the opportunity to conduct a pre-close inspection. Ideally, everything in the home will be as it should and you can continue to the close. However, if you notice that repairs need to be made to the home, you need to take action before closing. Here is what you need to know.
What Are Your Options?
One of the first things you need to do is make a list of the repairs that need to be made. Double-check your list to ensure that you have included everything. The list will be used by your real estate attorney to create an agreement with the seller of the home. Once you have the list completed, provide it to your attorney.
What Happens Next?
Your attorney will create an agreement that details what repairs need to be made and outline how the contractors are paid for the work. If there are additional terms that you want added to the agreement, your attorney can also include them. The agreement must be created before the closing.
Ideally, you and your attorney should get an estimate from contractors for the work that needs to be done before closing date. You can include the estimated amount of the work in your agreement. If you are unable to get the estimate before closing date, your attorney can inform the seller that the agreement will be amended once the estimated cost of repairs is known. The seller is still responsible for the repairs, but having an estimate helps to ensure that you are not given incorrect information.
Once closing occurs, your attorney will present the agreement to the settlement agent, who is responsible for ensuring that everything is handled at the closing. The settlement agent will then create an escrow account. The escrow account would hold part of the funds that the seller is supposed to receive from the sale of the home in an account until the repairs are completed. The amount held is based on the estimates you received. If you do not have any estimates, an agreed upon amount can be held.
There are many other aspects that should be considered when writing an agreement with the seller and creating an escrow account. Your attorney can help to ensure that your investment is protected. Contact a professional attorney, like those at Valentine & Valentine PC, to help you through the process.Share