As we all know the real estate market is very aggressive. It’s a sellers market and agents are being very creative when presenting offers. How do I word in my contract that my buyer is doing an inspection just for informational purposes but not requesting any credit or repairs. However, what about if structural damages/plumbing or electrical are discovered. Can you walk away from the contract without loosing your deposit/earnest money. I’m in NJ.
What’s the best way to word it in the contract (inspection for informational purposes) but at the same time protect your buyer. Advise please;
I'm a little confused here, if you're willing to walk away if the damages are too great, it's not just for informational purposes. While the market is hot, I haven't seen sellers balk at standard inspection contingencies, usually with the earnest money "going hard" after 15 days in a 30 day contract.
You are describing an “as-is” clause. You get all the same rights of backing out due to the inspection that you would otherwise, but you will not be asking the seller to fix any issues that come up in the inspection.
For contracts in Connecticut there is an as-is rider document that can be submitted with your offer that outlines what I mentioned above. The agents in your market probably have something similar. It can be effective in certain situations as a buyer.
If the electrical isn't insurable would that be okay with your client? If a structural beam was cut would that be okay? The problem with AS-IS - is that you're not saying your buyer will take it AS IS if AS IS is unacceptable. Leave the Inspection Contingency alone; for competitive purposes, shorten the contingency period. Then in the "other conditions"/narrative section state that the property must pass a 4-Point Inspection. That not only ensures that the major components are in good condition but that they have enough life remaining to engage insurance coverage.
There are a lot of ways to make an offer more enticing without boxing your client in.
What about getting an inspection done before putting in an offer if they are truly serious about a place?
@Claribel LopezAbreu if the inspection is for informational purposes, then just put contingent on walkthrough. But don't expect to come back with any negotiating power.
I just want to use the correct words.
there are houses that look great, but of course you don’t know what is hidden.
Do I write- Buyer will not request Any repairs or credits but inspection report should not show any structural, environmental, plumbing or electrical major issues.
Can you help me word it correctly? Thank you
what is the purpose of an inspection if you are not reserving right to back out of deal? if your client is worried about material repairs, then you could put in a monetary cap on the "as is" (e.g. taking "as is" unless the inspection report identifies defects that would exceed X amount of $$ ?
Note that "as is" only protects seller against breach of representation or warranty (i.e. contract claim). the clause alone does not protect seller against environmental claims unless the buyer expressly waives all statutory and common law rights.
Yes- I’ve been doing that- I wanted to know if there’s a different way of doing it.
I write - buyer willing to waive cosmetic repairs and will waive $1,500 of any major inspection repair if any” -
Is there a different way to word it?