One of the final steps before closing on your home is the final walkthrough. In some circumstances, your final walkthrough may not be as perfect as you expected.
This is a home buyer’s last chance to determine if the home is being delivered as expected as well as what is stated in the purchase and sale contract.
Your final walkthrough should be done just before closing and you should:
While often things go smoothly at your final walkthrough on occasion issues may arise. So what do you do to remedy issues?
Final walkthrough issues can encompass a wide range of issues. Some common final walkthrough issues could include:
Immediately notify the listing agent of what is not right with your final walkthrough. Better yet if you are working with a real estate agent representing you have them notify the agent. Do not let the listing agent talk you into accepting conditions that are not acceptable. Your purchase and sale contract should spell out the details. Once you close you own the problem and it will be next to impossible to have the seller remedy the situation.
Be clear of what the problem is and what you expect for a resolution. Remember if something is spelled out in a contract the seller is obligated and legally responsible to perform.
The simplest solution is to have the seller fix whatever the issue may be before the close. If it is the matter of a quick clean or removing some items the seller can run back and take care of it.
If the issues are a little larger than a quick clean by the seller or extensive junk removal than consider delaying the close until the issues are resolved. Something like a repair that hasn’t been completed could take days to repair. If this is the best solution for you make sure you don’t have any rate lock issues or your mortgage commitment expires in that time frame.
An escrow money hold back is where the closing attorney holds 1 to 1.5% of the cost of what an issue may cost to rectify. Additionally, the seller agrees to perform by a certain date. If the seller does not perform, the homebuyer is free to take matters into their own hands and submit receipts ton the closing attorney to be reimbursed.
Sometimes both parties will agree to a reduction in the purchase price so the buyer can go ahead and get a property professionally cleaned, have debris removed, etc….
If the results of your final walkthrough are so bad and costly to rectify and the buyer and seller can’t come to terms, you could just walk away from the purchase. Before making that decision consult an attorney to make sure you have the right walk away without losing your deposit monies.
If you do not close on time and expenses are occurred, talk to your buyer’s agent and attorney about being reimbursed for the expenses. You could request a seller reimburses you if you have to stay in a hotel for a few nights and/or if you have additional storage and moving expenses because of the delay caused by the seller.
While things can get tense when final walkthrough issues arise, remember to stay calm. There is usually a solution to any problem that can arise.
One last piece of advice, do the walkthrough when the house is vacant or almost vacated. This could mean waiting until an hour before the closing. Delivery of a home varies from state to state, but in Massachusetts the expectation is the property is vacant by the time of the closing.