Who Pays for Home Repairs - A Real Estate Dilemma

This is one issue that most real estate agents have faced more than once in their career. Sellers don’t want to pay for the repairs to a property that they are going to vacate soon. Homebuyers want their new abode to be spotless and are not willing to shell out money for repairs.

The ideal solution is for sellers and buyers to meet in the middle so that the transaction will move forward. But that is not always the case because buyers want a new house and sellers don’t want to spend more on a property they are disposing of.

Some agents come up with inspection and repair contingencies within the contracts. It is important for both sellers and buyers to read it first carefully before signing on the dotted line. The contingencies state the range of inspections that home buyers can do. Home buyers need to determine if the inspection and repair clause of the contract is something they can live with.

For instance, a contract can give the buyer a permit for general home inspection and then give a report to the seller. The inspection report would contain the repairs to be made or their monetary value. The seller can make the repairs, agree to the credit, or submit another arrangement. When the latter occurs, the buyer can accept, discuss or scrap the offer. This type of contract will benefit the buyer.

An example of a contract that benefits the seller is a contract that lets the buyer get a general home inspection, but it is for informational purposes only. The seller will not receive a notice for repairs or credits.

The contract that allows repairs or credit will have limits that buyers must be aware of. Some contracts allow the sellers and buyers to negotiate the repairs to be made. Other contracts only allow work to be done on building code violations or true defects in the structure.

Some agents advise their buyer clients to get an estimate for the repairs from a contractor and ask for a lesser credit instead of making the seller make the repairs themselves. This is a better choice instead of relying on the seller to make repairs that could be done in a sloppy manner. This approach benefits both the seller and the buyer, but it wouldn’t work if it involves structural defects such as a leaky roof and broken ventilation system.

Sellers must also make sure that the inspection report from the buyers is authentic. It could lead them to problems in the future if the deal doesn’t push through because sellers need to tell other potential buyers about the defects indicated in the inspection report. This is why it is important to have a competent real estate agent representing you in any transaction.