Seller switches to "as-is" midway through negotiations

[Natalie Landry]

Looking for advice. We signed a P&S agreement for a 4-bedroom, 2-bath with the contingency to conduct a home inspection. The inspection revealed that the heating/cooling system (heat pump) needed to be replaced because it was not working at all. The Disclosure signed by the Seller did not say anything about this and the Listing did not say anything about this. The house was built in 1971 with heat strips in the ceiling as a means of heating the house, with separate thermostats in each room. Several of these no longer work. This system was upgraded in 1992 with the central heating/cooling system that is now 25-years old and no longer works. We submitted a Repair/Replacement list to the Seller within the allowed time frame asking for a replacement of the heating unit and he said he has decided he wants to sell it as-is and will not be fixing anything. We have applied for conventional financing and are through the steps up to the appraisal. We are concerned we will not get approved if the home does not have an operable heating system for the entire home. Is a rehab loan our only avenue??? Any advice is welcome. Thank you.

[RJ Reynolds]

In Massachusetts, any time you ad provisions to a contract to purchase, even those found at inspection, results in either party being able to say NO. 

When my clients request repairs I always make certain they understand that doing so opens up the previously signed contract and releases both parties from the obligation to move forward.

There are all sorts of details about 'habitable' rules etc that someone else can respond to as I'm not an expert on that point. Your lender will certainly not give you a standard loan on something that isn't habitable however there are other loans that allow you to repair first, then mortgage and occupy.

Rj